Tax collection target set last year was overambitious: Abdul Hafeez Sheikh
ISLAMABAD: Special Assistant to the Prime Minister on Finance Hafeez Sheikh on Thursday admitted that the target for tax collection last year was overambitious.
He admitted that target of tax collection could not be met due to coronavirus situation. Rs3,900 billion tax was collected, he said.
Addressing a press conference, while flanked by Special Assistant of Prime Minister on Poverty Alleviation and Social Safety Sania Nishtar, Adviser to Prime Minister on Commerce and Investment Abdul Razak Dawood, Federal Minister for Economic Affairs Makhdoom Khusro Bakhtiyar and Parliamentary Secretary for Health Dr. Nausheen Hamid in Islamabad, Abdul Hafeez Sheikh said debts worth Rs5000 billion had been paid by the current government so far.
On this occasion, he released Economic Survey 2019-20 report.
“For the first time in Pakistan’s history income was higher than expenditures. Our priority has been increasing resources,” he said.
The SAPM said current account deficit stood at Rs3 billion now. He said new loans were taken to pay old loans which was the biggest liability on the government.
He claimed that budget balance was positive for first time. No debt was taken from the state bank during last year, he added. “We had less dependency on foreign debt the following year,” he maintained.
Abdul Hafeez Sheikh said no institute was provided a supplementary fund, tax collection was increased, imports were cut to ensure adequate amount of dollars.
He thanked Chief of Army Staff General Qamar Javed Bajwa for freezing the army budget. On tax collection, he said the government did not want to make strict regulations for collection of taxes because of the ongoing virus situation, which had badly affected business activities.
The special assistant said the government’s expenditures were drastically controlled. 1,240 billion rupees package was given for public relief recently, he said.
He said the government promised to pay power bills of SMEs to ensure their activity amid covid-19. The government would provide loans for SMEs, he said adding that social sectors would be given relaxation in taxes.
Abdul Hafeez said national income affected by 3 percent because of coronavirus. However, he said, 20 billion dollar current account deficit was reduced to 3 billion dollar. The government controlled trade deficit, he added.
The advisor to prime minister projected -0.4 percent overall GDP growth next year with agricultural growth at 2.67 percent and industrial growth -2.64. Pakistan’s debt to GDP ratio is 88 percent, he relayed.
He said low income people would be given exemption in taxes up to 90 percent. We will try to give people as much relief as possible in the budget, he added.
“We will try not to impose taxes in the new budget. Tax relaxation has already been given in the housing sector,” he said.
Makhdoom Khushru Bakhtiyar said that current account deficit concluded at 3.3 percent, while Rs50 billion stimulus package was given for agricultural sector.