National Assembly Approves Budget 2023-24 with New Recommendations of Heavy Taxes

National Assembly Approves Budget 2023-24 with New Recommendations of Heavy Taxes

Islamabad, June 25, 2023: The National Assembly of Pakistan has given its approval to the budget for 2023-24, incorporating new recommendations for imposing significant taxes.

The Finance Bill 2023, which passed in the National Assembly on Sunday, includes amendments aimed at implementing the financial proposals of the federal government for the upcoming fiscal year, starting from July 1, 2023.

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The budget emphasizes economic stability, sustainable and inclusive growth, and the mitigation of inflationary pressures, with a total outlay of Rs14.48 trillion. The Federal Public Sector Development Programme (PSDP) has been allocated Rs 1150 billion, marking the largest size ever in support of improving the standard of living for the people.

To promote the uplift of the agriculture, industries, and IT sectors, as well as provide relief to various segments of society, including the salaried class, the budget introduces special initiatives. Notably, the agriculture credit limit has been raised from Rs 1800 billion to Rs 2,250 billion, and Rs 30 billion has been allocated to converting fifty thousand agriculture tube wells to solar energy. Additionally, all taxes and duties on the import of quality seeds have been eliminated.

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Under the budget, IT and IT-enabled service providers are permitted to import software and hardware equivalent to one percent of their exports without any taxes. The limit for these imports is set at fifty thousand dollars annually. Furthermore, the Prime Minister’s Youth Business and Agriculture Loans scheme will receive Rs 10 billion in funding.

The budget also encompasses salary increments, with a 35 percent ad-hoc relief allowance for employees in grade 1 to 16 and a 30 percent ad-hoc relief allowance for employees in scale 17 and above. Pension rates have increased by 17.50 percent, while the minimum wage has been raised from Rs 25,000 to Rs 32,000.

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Furthermore, Rs 1804 billion has been allocated for defense affairs and services. The National Assembly also passed “The Election (Amendment) Bill, 2023” to introduce amendments to the Election Act 2017, following its prior approval by the Senate.

After the budget’s passage, Finance Minister Ishaq Dar expressed his confidence that the concrete measures outlined in the budget will steer the country towards development. He credited Prime Minister Shehbaz Sharif’s political sagacity for achieving significant economic stability and acknowledged the guidance provided by the Prime Minister, cabinet members, coalition partners, and Parliamentary Leaders in prioritizing the budget.

Finance Minister Ishaq Dar also announced an honoraria equivalent to three months of basic pay for employees of the National Assembly, Senate, and other departments who performed duties during the budget session.

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Defence Minister Khawaja Muhammad Asif expressed optimism in reaching an agreement with the International Monetary Fund (IMF) to restore economic stability. Minister for Human Rights Riaz Hussain Pirzada commended the government for introducing various incentives for farmers, highlighting the positive impact on the agriculture sector. Minister for Climate Change Sherry Rehman emphasized that the budget prioritizes the reconstruction and rehabilitation of flood-affected areas. She further expressed disappointment in the world’s neglect of the victims of the previous year’s disaster in Pakistan, while commending Prime Minister Shehbaz Sharif’s efforts to advocate for climate justice during a conference in Paris.

The National Assembly has adjourned and will reconvene on the 17th of next month at 5 p.m.