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  • Grant of 10% increase in pension notified

    Grant of 10% increase in pension notified

    ISLAMABAD: The federal government on Thursday notified the grant of 10 per cent increase in pension of all government pensioners with effect from July 01, 2021.

    The finance ministry said that the President has sanctioned an increase at 10 per cent of net pension with effect from July 01, 2021 until further orders to all Civil pensioners of the Federal Government including Civilians paid from Defence Estimates as well as retired Armed Forces personnel and Civil Armed Forces Personnel.

    The ministry said that the previous increase in pension would be admissible to the new pensioners who would retire on or after July 01, 2021.

    The latest 10 per cent increase in pension as will also be admissible to the pensioners who would retire on or after July 01, 2021.

    For the purpose of admissibility of increase in pension sanctioned in this O.M. the term “Net Pension” means “Pension being drawn” minus “Medical Allowance”.

    The increase will also be admissible on family pension granted under the Pension-cum-Gratuity Scheme, 1954, Liberalized Pension Rules, 1977, on pension sanctioned under the Central Civil Services (Extra Ordinary Pension) Rules as well as on the Compassionate Allowance under CSR-353.

    lf the gross pension sanctioned by the Federal Government is shared with any Government in Accordance with the rules laid down in part-iv of Appendix-lll to the Accounts Code, Volume-I, the amount of the increase in pension will be apportioned between the Federal Government and the other Government concerned on proportionate basis.

    The increase in pension sanctioned in this O.M. will not be admissible on Special Additional Pension allowed in lieu of pre-retirement Orderly Allowance and monetized value of a driver or an orderly.

    The benefit of increase in pension sanctioned in this O.M. will also be admissible to those Civil Pensioners of the Federal Government who are residing abroad (other than those residing in India and Bangladesh) who retired on or after 15.08.1947 and are not entitled to, or are not in receipt of pension increase under the British Government’s Pension (increase) Acts. The payment will be made at the applicable rate of exchange.

  • Notification for 10% ad hoc increase in salary issued

    Notification for 10% ad hoc increase in salary issued

    ISLAMABAD: The President of Pakistan has sanctioned the grant of ad hoc 10 per cent increase in salary of government employees effective from July 01, 2021, according to a notification issued by the ministry of finance on Thursday.

    It said that the president has been pleased to sanction with effect from July 01, 2021 and till further orders, an ad hoc relief allowance 2021 at 10 percent of basic pay to all the federal government employees i.e. armed forces personnel, civil armed forces and civil employees of the federal government as well as the civilians paid from defence estimates including contingent paid staff and contract employees employed against civil posts in basic pay scales on standard terms and conditions of contract appointment.

    The amount of ad hoc relief allowance 2021:

    i. will be subject to income tax;

    ii. will be admissible during leave and entire period of LPR except during extra ordinary leave;

    iii. will not be treated as part of emoluments for the purpose of calculation of pension/gratuity and recovery of house rent;

    iv. will not be admissible to the employees during the tenure of their posting/deputation abroad; and

    v. will be admissible to the employees on their repatriation from posting/deputation abroad at the rate and amount which would have been admissible to them had they not been posted abroad.

    The finance ministry said that the term ‘basic pay’ for the purpose of ad hoc relief allowance 2021 will also include the amount of the personal pay granted on account of annual increment(s) beyond the maximum of the existing pay scales.

  • Finance ministry, IMF meeting to finalize budget proposals

    Finance ministry, IMF meeting to finalize budget proposals

    ISLAMABAD: An important meeting of the ministry of finance with representatives of International Monetary Fund (IMF) will be held today evening (Thursday evening) to finalize the recommendations for budget 2021/2022.

    Senior officials of the ministry of finance, three representatives, including country head, of IMF and senior officials of Federal Board of Revenue (FBR) will attend the meeting, sources said.

    Officials of the IMF will attend the meeting through video link.

    The meeting will discuss important points of the budget, which will include salary income tax and sales tax reforms.

    The sources said that the meeting would finalize tax slabs for salaried persons.

    The IMF had proposed reduction in salary tax slabs from 11 to five. Further the meeting will discuss sales tax incentives and reduced rates.

    The sources said that the government would finalize the proposals after discussions with the IMF.

    The source said that the government is considering an increase of 10 percent in salaries and pension. This increase would be given through adhoc basis. However, the government is not considering to grant the increase in basic pay scale.

    The government has decided to allocate an amount of Rs900 billion for Public Sector Development Program (PSDP).  The budget deficit may be curtailed at six percent of the GDP.

    In his recent statement, Finance Minister Shaukat Tarin had already made it clear that the government was not in position to take strict measures due to covid pandemic.

  • Motor vehicle tax collection grows by 22.7pc; finance ministry issues nine-month statistics

    Motor vehicle tax collection grows by 22.7pc; finance ministry issues nine-month statistics

    ISLAMABAD: The collection of motor vehicle tax has been increased by 22.7 percent owing to better economic conditions during the current fiscal year as compared with unfavorable conditions in the last fiscal year due to corona pandemic.

    According to statistics released by the ministry of finance for the period July – March 2020/2021, the collection of motor vehicle tax increased to Rs20.53 billion during the first nine months of the current fiscal year as compared with Rs16.73 billion in the same months of the last fiscal year.

    The economic conditions were not encouraging at the start of the last fiscal year and later the coronavirus related lockdown adversely impacted commercial and financial activities.

    The provinces have jurisdiction over the collection of motor vehicle tax.

    The province wise collection revealed that the Punjab had posted 15.18 percent increase in motor vehicle tax collection during the period under review. The province collected Rs11 billion during July – March 2020/2021 as compared with Rs9.55 billion in the corresponding period of the last fiscal year.

    The province of Sindh collected Rs7.55 billion during July – March 2020/2021 as compared with Rs5.52 billion during the corresponding period of the last fiscal year, showing an increase of 36.27 percent.

    Khyber Pakhtunkhwa registered an increase of 9.65 percent to Rs1.25 billion during first nine months of the current fiscal year as compared with Rs1.14 billion, showing an increase of 9.65 percent.

    The province of Balochistan posted the highest growth of 43.13 percent to Rs0.73 million during July – March 2020/2021 as compared with Rs0.51 million in the same period of the last fiscal year.

  • Applications invited for post of DG National Savings

    Applications invited for post of DG National Savings

    ISLAMABAD: The ministry of finance on Sunday invited applications for the post of Director General, Central Directorate of National Savings, Islamabad.

    The ministry said that prescribed qualification, experience, age limit and other terms of contract appointment under Management Position Scales Policy, 2020 (MP-I) scale are given as under:

    Qualification: Master degree in any of the disciplines: economics, statistics, commerce, accounting, finance, business administration, cost and management accountants, chartered accountants, or equivalent from an HEC recognized University / institutions.

    Experience: At least 18 years experience in the banking/ financial sector or in finance related positions in the public sector.

    Age Limit: minimum age 50 years; maximum age 62 years

    Period of Appointment: Three years extendable for further two years contingent upon result based performance.

    Place of Posting: Islamabad

    Termination of Contract: On one month’s notice on either side or payment of one month’s pay in lieu thereof.

    Pay Package: The pay package will be based on MP-I Scale and other incentives as per those admissible to officers in MP-I scale.

    The ministry said that interested applicants should submit applications through courier service alongwith their CVs and copies of testimonials duly verified by institutes and recent photographs within 15 days of the publication of the advertisement for above mentioned position.

    Only short listed candidates will be called for interview. The candidate must be citizen of Pakistan.

  • Pakistan’s fiscal deficit narrows in nine months

    Pakistan’s fiscal deficit narrows in nine months

    ISLAMABAD: Pakistan’s fiscal deficit has narrowed to 3.6 percent of the GDP during first nine months (July – March) of the current fiscal year as compared with the deficit of 3.8 percent in the corresponding months of the last fiscal year, according to data released by the finance ministry on Thursday.

    According to commentary of Arif Habib Limited, Pakistan’s fiscal balance in the current fiscal year to date has strengthened over prior year, with the deficit arriving at Rs1.65 trillion in nine months of fiscal year 2020/2021 (3.6 percent of GDP) compared to Rs1.69 trillion in the corresponding months of the last fiscal year (3.8 percent of GDP), down by 2 percent YoY.

    Moreover, the primary surplus during the period at Rs452 billion (1.0 percent of GDP in nine months of fiscal year 2020/2021) fares better compared to a primary surplus of Rs194 billion witnessed last year (0.4 percent of GDP).

    Primarily, total revenue growth at 6 percent in nine months of fiscal year 2020/2021 to Rs5.0 trillion (nine months of the last fiscal year: Rs4.7 trillion) aided the fiscal balance, translating into 11.0 percent of GDP vs. 10.7 percent last year. The total tax revenue collection has gone up by 5 percent YoY to Rs3.8 trillion. Indirect taxes (+13 percent YoY to Rs2.15 trillion), sales tax (+14 percent YoY to Rs1.42 trillion), and direct taxes (+9 percent YoY to Rs1.25 trillion amid higher number of tax payers), contributed to the overall collection.

    In addition, the government collected Rs1.17 trillion in non-tax revenues, displaying a jump of 13 percent YoY. This was particularly owed to imposition of Petroleum Levy, which is now classified under non-tax revenue (+86 percent YoY | Rs369 billion). On the flipside, the surplus profit of State Bank of Pakistan and Pakistan Telecommunication Authority declined during nine months of fiscal year 2020/2021 to Rs498 billion (-22 percent YoY) and Rs20 billion (-82 percent YoY), respectively.

    In addition, total expenditures went up by 4 percent YoY to Rs6.6 trillion (14.6 percent of GDP vs. 14.5 percent of GDP in 9MFY20). Further breakup revealed that current expenditure underwent an uptick of 8 percent YoY of which markup payments rose by 12 percent YoY. On the contrary, the defence expenses went down by 2 percent YoY to Rs784 billion. Moreover, development expenditure and net lending undertaken by the government declined by 7.5 percent YoY to Rs723 billion.

    Total PSDP expenditure in nine months of fiscal year 2020/2021 arrived at Rs654 billion (-9 percent YoY) with provincial expenditure at Rs390 billion, outdoing federal disbursement of Rs264 billion.

    Decline of 26 percent YoY in deficit during 3QFY21

    The analysts highlighted that cumulatively all four provincial governments recorded an overall balance of Rs413 billion during nine months of fiscal year 2020/2021, compared to Rs344 billion recorded in the corresponding period last year, marking a 20 percent increase. However, Sindh and KPK recorded a decline of 10 percent YoY and 70 percent YoY, respectively.

    Pertinently, budget deficit during 3QFY21 settled at Rs514 billion (1.1 percent of GDP), depicting a decline of 26 percent YoY vis-à-vis Rs691 billion during 3QFY20.

    Total revenues of the government in 3QFY21 arrived at Rs1.64 trillion (3.6 percent of GDP), up by 13 percent YoY from Rs1.46 trillion during 3QFY20.

    FBR taxes increased by 25 percent YoY to Rs1.18 trillion due to 15 percent YoY rise in direct taxes to Rs416 billion in 3QFY21 whereas collection from sales tax and indirect taxes went up by 30 percent and 39 percent YoY to Rs498 billion and Rs769 billion, respectively.

    Total expenditure in 3QFY21 clocked in at Rs2,156 billion (4.7 percent of GDP), up 0.3 percent YoY over the same period of last year (Rs2,149 billion; 4.9 percent of GDP) with a 9 percent rise in defense expenditure to Rs297 billion and 9 percent uptick in current expenditure to Rs2.1 trillion.

  • Pensioners living abroad require presenting life certificate

    Pensioners living abroad require presenting life certificate

    ISLAMABAD: The finance division has made it mandatory for pensioners living abroad to submit life certificate in place of biometric verification.

    The ministry of finance on Tuesday issued a notification stating that through a SRO issued January 28, 2021 it was made mandatory for pensioners to ensure verification of biometric in order to receive pension.

    The ministry however stated that the pensioners receiving pension abroad through Pakistan Mission Office, Ministry of Foreign Affairs (MOFA) / Chief Accounts Officer, MOFA will continue to provide proof of life through a medical certificate or by way of Life Certificate signed by a Gazetted Officer of Pakistan Mission in that area/country.

    The Pakistan Mission, shall forward the life certificate or medical certificate through chief accountants office, MOFA to Accounts Office concerned for information and record purposes.

  • Hammaz Azhar given Finance Minister portfolio

    Hammaz Azhar given Finance Minister portfolio

    ISLAMABAD: Hammaz Azhar has been named new Finance Minister of the country. Hammad Azhar, who is presently federal minister for industries and production, has confirmed his new assignment through a tweet on Monday.

    “I am honored to be entrusted with the additional charge of finance by the prime minister,” Hammad Azhar said in the tweet.

    “Pakistan’s economy has made significant gains towards stabilization since 2018. We shall continue to consolidate these gains and strengthen the growth momentum,” he added.

    Earlier, Senator Shibli Faraz confirmed the changes in the finance ministry.  The government decided to remove Dr Abdul Hafeez Shaikh from the post of finance minister and replace him with Minister for Industries and Production Hammad Azhar, Faraz told a private TV channel.

    He said that Prime Minister Imran Khan decided to bring in a new finance team in view of the inflation that had taken place.

    Hammad is the third finance minister of PTI government.

    Prime Minister Imran Khan gave the portfolio of finance to Hammad Azhar who is a young and able minister so that he devises policies according to the ground realities of Pakistan and the poor get relief, according to Faraz.

  • Stamp duty collection falls by 24 percent in first half

    Stamp duty collection falls by 24 percent in first half

    The revenue collection from stamp duty fell sharply by 24 percent during first half of the current fiscal year owing to significant decline in revenue reported by the province of Punjab, according to a report issued by the federal finance ministry.

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  • Budget deficit widens to 2.5 percent in first half: finance ministry

    Budget deficit widens to 2.5 percent in first half: finance ministry

    ISLAMABAD: The budget deficit has widened to 2.5 percent of the GDP during first half (July – December) of the current fiscal year 2020/2021 as compared with the deficit of 2.3 percent in the corresponding half of the last fiscal year, according to statistics released by the ministry of finance on Wednesday.

    According to the details, the total revenue was at Rs3,351 billion during the first half of the current fiscal year. Meanwhile, total expenditures was at Rs4,489 billion in the same period of the current fiscal year. Therefore, budget deficit stood at Rs1,138 billion or 2.5 percent of the GDP.

    The total tax revenue was recorded at Rs2,456 billion during the first half of the current fiscal year.  Out of which the contribution of the federal government was Rs2,210 billion and the rest Rs246 billion was by the provincial governments.

    The non-tax revenue was recorded at Rs895 billion out of which federal government contributed Rs484 billion and the provincial governments share was at Rs47 billion.

    The current expenditure has increased to Rs4,029 billion out of which the government’s mark up payments against loans were at Rs1,475 billion and defence expenditures were at Rs486 billion.

    The government spent Rs458 billion on development expenditure during the first half of the current fiscal year.

    The total revenue collection to GDP ratio during first half of the current fiscal year was at 7.4 percent. The total expenditure to GDP ratio was at 9.9 percent.