'No new taxes' in Rs7.13 trillion budget FY2021, says govt

Minister for Industries Hammad Azhar on Friday presented the federal budget for the fiscal year 2020 -21, referred to as the 'crown budget' by the adviser to the Prime Minister of Finance and Revenue, Dr. Abdul Hafeez Shaikh, a day earlier as he unveiled the economic survey. for the fiscal year 2019-20.

Among the main figures revealed on the floor of the National Assembly, the Federal Revenue Board (FBR) revenue target remained at Rs4.95 trillion for next year, while defense allocations amounted to around Rs1 .3 trillion. The federal development program was budgeted at Rs650 billion to support growth prospects.

Read the complete FY2021 Budget here.

Prime Minister Imran Khan in the National Assembly. - Photo of the application
Prime Minister Imran Khan also attended the session. Azhar began the session by saying that it was an honor for him to present the PTI government's second budget under the leadership of Prime Minister Imran.

He then highlighted some of the government's main achievements in the outgoing fiscal year, noting a 73 percent decrease in the current account deficit, which is now below $ 3 billion, he said. "There is also a primary surplus that we have achieved in the last nine months," he said.

The opposition-held banners and recited anti-PTI government slogans as the budget was presented. - Amir Wasim
In the background of Azhar's speech, loud slogans were heard against the prime minister and table blows by opposition banks when the minister highlighted the efforts of the PTI-led government to rationalize the economy. Later, the opposition left the Chamber in protest.

Azhar said, "our budget deficit was reduced from 5pc to 3.8pc, while the IMF gave us an extended facility of Rs6 billion and remittances increased from Rs16b to Rs17b." He noted that Bloomberg had called PSX the highest-performing market in December 2019.

Presenting details of the new budget, the minister emphasized that "no new tax was introduced in this budget." He said the need for the hour was an expansive fiscal policy that the government was implementing.

Total expense
He said that the total size of the budget or the total expenditure budget for the next year stood at Rs 7,136 million, slightly more than the figure budgeted for the previous year.

Current expenses
Of this total, current expenditures for the upcoming fiscal year were budgeted at Rs6.345 billion, above the Rs6.193b budgeted last year, Azhar said. Of this, Defense Affairs represents Rs1,289 billion, 11% more than the previous year, and interest payments represent Rs2,946 billion.

Allocations for education have been budgeted at Rs83.3 billion, an increase of 7.9pc from Rs77.2 billion last year. Health allocations for next year have more than doubled (an increase of 130pc) to Rs25.5 billion from Rs11 billion last year. During his speech, Azhar explained that the funds would be used to improve health services and digitize the framework.

PSDP
Hammad Azhar revealed that total spending for public sector development projects (PSDP) for the upcoming fiscal year had been budgeted at Rs1,324 billion, which is 18pc below last year's budget.

Of this, the federal PSDP was allocated Rs650 billion, while Rs676 billion was allocated to provinces.

Fiscal deficit
The fiscal deficit, he said, would be 7% of GDP and has been budgeted at Rs3,195 billion for the fiscal year 2013. The minister regretted that the deficit has increased on multiple occasions during the regimes of previous governments, but said that this government will try to keep it under control.

Growth rate
Azhar said the government will pull the economy out of a 0.4pc contraction and points to 2.1pc GDP growth for the fiscal year 2021.

Inflation
Consumer Price Index (CPI) inflation for the fiscal year 2021 has been budgeted at 6.5pc, below a projection of 13pc last year.

Total income
Total revenue, he said, is budgeted at Rs6.573 trillion, of which net federal revenue will be Rs3.700 trillion.

FBR tax revenue
Azhar went on to reveal that the FBR tax collection has been budgeted at Rs4.963 billion, which is less than last year's original budgeted amount of Rs5.555 billion. The minister stressed during his speech that the government wants this to be a "relief budget" due to the crises caused by the pandemic and that the government is not imposing new taxes for the new year.

This year's budget session is considered a formality, as both PPP and