Insufficient release of Public Sector Development Programme (PSDP) funds has hit revenue generation due to slow economic activities, said the Federal Board of Revenue (FBR) sources.
FBR sources said the province of Punjab has been hub of economic activity over the last 15 years out of the funds released under PSDP by the PML-N government. However, the present government is very cautious towards release of PSDP funds that has slowed down economic activity, and ultimately the revenue generation.
The government has disbursed Rs187 billion (27.7%) under the Public Sector Development Programme (PSDP) 2018-19 which includes foreign Rs57.4 billion foreign aid for various development projects. As per latest data released by the Ministry of Planning Development and Reform regarding PSDP 2018-19, the government disbursed Rs79.06 billion including Rs6 billion foreign aid for development projects of several ministries, divisions and related departments out of Rs291.55 billion budgeted allocation, reports an English daily. No funds have been released by the government till now for the commerce division, inter-provincial coordination division and religious affairs and inter-faith harmony division.
According to FBR sources, the development activities in the province of Punjab was main driving force behind the economic wheel of the country and former Chief Minister Shahbaz Sharif was spending heavily out of development funds, both from the PSDP as well as the Annual Development Programme (ADP) of his government. Moreover, there was no uncertainty and everyone had a clear idea about the continuity of the government, a fundamental factor behind the economic activity in the country.
Also, a large number of projects were installed in various sectors that triggered massive activity at that time.
The present government has stalled whole range of economic activities and release of funds from the PSDP is very meager if one compares it with the previous regime of PMLN, said sources and added that no revenue generation is expected until release of development funds is back to normal pace. "Taxpayers could only pay income tax if they are generating income," the FBR stressed.
It may be noted that the government leads the economy from the front by initiating development works that kick start productivity of some 40 industries relating to development work. Furthermore, a backlog of utility charges has also contributed to slowing down of economy as the previous kept utility charges unchanged since 2015 due to political expediency arising out of Panama scandal and other issues. This situation led to a huge loss to the utility agencies and the present government had no option but to increase tariff after taking charge of the government.