ISLAMABAD: Advisor to Prime Minister on Finance Abdul Hafeez Shaikh on Saturday said that the government had announced a relief budget as no new tax was imposed, but taxes and duties were either waived entirely from certain things or cut.
The PM’s advisor said this in a post budget press conference in Islamabad. He was flanked by Ministor for Industries Hammad Azhar and Advisor to PM on Poverty Sania Nishtar.
Recounting the challenges faced by the government since its inception, he said the government faced acute shortage of dollar reserves when it came into power.
“Our current account deficit was on its historical peak — 20 billion dollar — which was brought to 3 billion dollars,” he said.
Rs 1600 billion were collected in non-tax revenue, whose target was Rs1100 billion, he said relaying achievements of the government. He said prior to corona pandemic the IMF board praised the measures taken by the government for uplifting the economy, Moody’s appreciated the economic indicators and Bloomberg termed Pakistani stock exchange the best in the world.
Abdul Hafeez Shaikh said foreign direct investment was increased by 137 % because of the ease of doing businesses measures.
On effects of the viral infection, he said Coronavirus hurt not just the national economy but economies worldwide also. He said according to the IMF, the entire world’s income will reduce by 4 percent.
“Due to COVID-19, 3000 billion rupees loss will be faced by the Pakistani GDP. We bore loss of Rs 700 billion revenue as our shops, industries and transports were closed, which increased poverty and unemployment,” he said.
The advisor to PM said viewing this situation, the government announced 1200 bn rupees financial relief package.
He said despite all this the government decided not to impose any new tax as people are already facing difficulty due to coronavirus.
“There are 1,623 duty-free tariff lines, which means there are 1000s of items that can be exported without any duty in a bid to increase employment,” he added.
The advisor said that in other 200 tariff lines, duties were being cut, in 166 tariff lines, regulatory dutes were being cut to reduce cost of doing business. waiving 10 kinds of withholding taxes, withholding tax on import would be reduced from 5 to 2 percent, tax in hospitality sector reduced from 1.5 to 0.5 percent.
“I call it a relief budget because it offers massive tax deduction,” he said.
Advisor to the Prime Minister on Finance, Abdul Hafeez Sheikh said the government had provided relief to poor masses and construction industry in next fiscal year budget.
He said 30 billion rupees had been allocated for housing of low income group, while 2900 billion rupees would be paid over loan taken by the last governments.
To a question, he said if petroleum price changed in near future then levies duty would be brought down.