Federal Minister for Finance Muhammad Aurangzeb said on Monday that the Federal Board of Revenue (FBR) would not be able to arrest persons evading tax up to Rs50 million without warrants. Speaking in the National Assembly, he said that the government would soon announce the industrial policy.  The minister said that the budget presented by the government for the next financial year (FY), 2025-26 was a ‘balanced’ one. “We have reduced taxes on the salaried class in the budget,” he said, adding, “Efforts are being made to curtail the government expenditures.”

Winding up the budget debate, Aurangzeb further said that the government was making improvements in the tax rules. “We will grant loans to farmers on easy terms and conditions.”  The minister said that steps were being taken to increase the country’s exports. He said that suggestions had been given in the budget to deal with environmental pollution. He informed that steps were also being taken to broaden the tax base. 

“There will be a slight increase in the prices of solar panels,” he said, adding that an amount allocated for the Benazir Income Support Programme (BISP) in the budget had also been increased. Aurangzeb said that the present situation in the Gulf would have adverse effects.  He informed that a three-member FBR committee would investigate the cases of tax evaders, and that tax evaders would be presented before the magistrate within 24 hours. 

Aurangzeb described the budget for the next financial year as balanced, emphasizing that measures have been taken to pave the way for inclusive and sustainable economic growth. The minister said the government is cognizant of tax burden on salaried class. He said it has been decided to take one percent tax from those earning between Rs600,000 and 1.2 million rupees.  He said sales tax on imported solar panels is being reduced from eighteen percent to ten percent. 

He said that the powers of FBR have also been reviewed to avoid the misuse of authority. He said the FBR cannot arrest a person in cases up to 50 million rupees without judicial warrant. Aurangzeb presented three new measures aimed at meeting the revenue shortfall. He stated that effort has been made to ensure that only the affluent class falls within their scope. Federal Exercise duty at the rate of ten rupees has been imposed on one-day old chicken and rates have been increased on companies' investment in mutual funds and earnings from investment in government securities. 

He said while managing the government expenditures, the focus remains on increasing revenues by broadening the tax base and enhancing tax compliance.  He informed the House that digitalization is being promoted and new laws being introduced to ensure better tax compliance. The minister said the government has reduced tax burden on the salaried class while the construction industry has been facilitated. He said reduction in import duties will bring down the cost of inputs for the industries and help bolster our exports.

He said these steps will also help curb smuggling, promote industries and help enhance government revenues. Aurangzeb said the government will soon announce an industrial policy while consultation process has been started for the EV policy. He mentioned that the budget of Benazir Income Support Program has been enhanced from 592 billion rupees to 716 billion rupees.  He said the government is also about to introduce Pakistan's first Skills Impact Bond to align the youth with market-oriented skills. 

He said the government has prepared a flagship programme to provide loans to the small farmers without any guarantee.  Under this program, loans up to one million rupees will be provided to the farmers having up to 12.5 acres of land through digital means.  He said the farmers will also be provided with crop and life insurance facilities.  In addition, a mechanism of electronic warehouse receipts is being evolved for the farmers, emphasizing this will ensure that the farmers get better price of their produce.

Credit: Independent News Pakistan (INP)