Prime Minister Imran Khan has rejected a proposal to impose tax on pensioners and retirees in the upcoming budget.
A proposal to impose 7.5% tax on pensioners was rejected, according to finance ministry sources. This tax on pensions would have generated more than Rs18 billion in revenue for the government.
The federal government pays Rs250 billion annually in pensions.
A total of Rs47 billion has been allocated for an increase in government employees’ salaries. For pensions, an extra amount of Rs47.7 billion has been allocated. It is estimated that a total of Rs527 billion will be allocated in pensions. Furthermore, the government will not impose any new taxes on the salaried class.
A total of Rs530 billion can be set aside for subsidies. The non-tax revenue could be around Rs1420 billion in the next budget.
Budget session on June 11
Last week, the government decided to convene a session of the National Assembly on June 11 to table the budget for the financial year 2021-22. The session was convened after Adviser to the Prime Minister on Parliamentary Affairs Babar Awan met with Speaker Asad Qaiser.
The budget schedule was finalised during the meeting. Furthermore, parliamentary and national affairs were also discussed by the Pakistan Tehreek-e-Insaf (PTI) leaders. The budget will be presented by Finance Minister Shaukat Tarin in the assembly and later it will also be tabled before Senate as the debate on it will be concluded by June 28.
The budget will spend Rs3,060bn on loans and interest. The budget deficit for the next financial year could be Rs2,915bn. A sum of Rs900bn will be spent on the annual development program.