Islamabad, August 18, 2023 – Pakistan’s fiscal performance for the fiscal year 2022-23 was unveiled on Thursday, indicating a reduction in the budget deficit to 7.7 percent coupled with a notable increase in expenditures by more than 21 percent.
As per data released by the finance ministry on August 17, 2023, the total size of the Gross Domestic Product (GDP) expanded by 26.43 percent, reaching Rs 84.65 trillion during the fiscal year 2022-23, as compared to Rs 66.95 trillion in the preceding fiscal year.
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The government’s total revenue witnessed a growth of 20 percent, amounting to Rs 9.633 trillion from July 2022 to June 2023, compared to Rs 8.035 trillion in the previous year. Within this, tax revenue demonstrated an increase of 15.73 percent, reaching Rs 7.818 trillion, up from Rs 6.755 trillion. The tax-to-GDP ratio remained below the double-digit mark, at 9.23 percent.
The federal tax revenue escalated by 16.71 percent, reaching Rs 7.17 trillion from Rs 6.143 trillion. Concurrently, the provincial revenue authorities saw a 6.21 percent growth in revenue collection, amounting to Rs 650 billion.
Conversely, non-tax revenue experienced a significant surge of 42 percent, reaching Rs 1.815 trillion during the fiscal year 2022-23, as compared to Rs 1.28 trillion.
Total expenditures of the country surged by 21.42 percent, totaling Rs 16.15 trillion in the fiscal year under review, in contrast to Rs 13.3 trillion in the previous year. Within these expenses, defense expenditures saw an increase of 12 percent, amounting to Rs 1.58 trillion compared to Rs 1.411 trillion.
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The expenses on markup payment increased phenomenally by 83 percent to Rs 5.83 trillion in the fiscal year 2022-23 when compared with Rs3.18 trillion in the preceding fiscal year.
The budget deficit for the fiscal year 2022-23 stood at 7.7 percent, marking a decline from the 7.9 percent recorded in the previous year. This financial snapshot highlights the challenges and trade-offs the government faced in maintaining economic stability while addressing the increasing expenditures, especially in the defense sector. The figures underscore the need for continued fiscal management and targeted reforms to ensure sustainable economic growth in Pakistan.
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