LAHORE: The Punjab government on Monday presented a total outlay of Rs2,653 billion provincial budget for fiscal year 2021/2022, which is 18 percent higher than the outgoing fiscal year.
Punjab Finance Minister Makhdoom Hashim Jawan Bakht presented the budget in the provincial assembly. He announced an increase of 10 percent in salary and pension of all provincial government employees. Besides, the provincial government also announced a 25 percent increase as special allowance for those employees between grade – 1 to grade -19, who were never granted any type of allowance in the past.
The Punjab government also announced to increase monthly minimum wage from Rs17,500 to Rs20,000.
Giving details of the budget 2021/2022, the provincial minister said that the province would get Rs1,684 billion under National Finance Commission (NFC) Award, which would be 18 percent from the outgoing fiscal year.
He said that the provincial revenues have been estimated at Rs405 billion for the next fiscal year, which is 28 percent higher than the outgoing fiscal year.
The Punjab government allocated Rs560 billion for annual development plan (ADP) for next fiscal year, which is 66 percent higher than the outgoing fiscal year.
The provincial minister announced tax concessions worth Rs50 billion during the fiscal year starting from July 01, 2021.
The minister said that an amount of Rs40 billion would be granted as tax incentive for construction sector during the next fiscal year. This concession would be available by maintaining stamp duty at one percent during the next fiscal year.
The provincial government decided to continue reduced rate of sales tax on services from 16 percent to five percent during the next fiscal year. The reduced rate of sales tax would be available on services included small hotels, guest houses, marriage halls, lawns, caterers, IT services, tour operators, jims, property dealers, rent a car service, cable tv oprators, treatment of textile and leather, commission agent of commodity operation, auditing accounting and tax consultancy services, photography and parking services etc.
In addition to mentioned above services, the provincial government decided to add more 10 services into reduced rate of tax regime. The government allowed reduced rate of sales tax on services from 16 percent to 5 percent to beauty parlor, fashion designers, home chefs, architects, laundries and drycleaners, supply of machinery, warehouse, dress designers and rental bulldozers etc.
The government decided to reduced sales tax rate from 19 percent to 16 percent on call centers.