Home Latest News Government to Table ‘Mini-Budget’ in Parliament Today

Government to Table ‘Mini-Budget’ in Parliament Today

Cabinet approves Finance Bill, 2023 after President Arif Alvi ‘advises’ finance minister to take lawmakers into confidence rather than promulgating ordinance

by Staff Report

Photo courtesy PID

President Arif Alvi on Tuesday “advised” Finance Minister Ishaq Dar that it will be “more appropriate” for him to take Parliament into confidence on imposing Rs. 170 billion in fresh taxes rather than promulgating an ordinance to expedite implementation of fiscal measures required by the International Monetary Fund (IMF).

A statement issued by the Presidency said that Dar had called on Alvi earlier in the day and informed him of the progress in talks between the IMF and the government. “The president appreciated the efforts of the government for negotiating an agreement with the IMF, and assured that the state of Pakistan would stand by the commitments made by the government with the IMF,” it said, adding that the minister had informed the president of the government’s desire to raise additional revenue through taxes by promulgating an ordinance.

“The president advised that it would be more appropriate to take Parliament into confidence on this important subject, and that a session be called immediately so that the bill is enacted without delay,” it added.

Following the president’s refusal to promulgate an ordinance, the federal cabinet approved a “mini-budget”—the Finance Bill, 2023—with the Prime Minister’s Office saying it would be tabled in both the National Assembly and Senate today (Wednesday).

The government will now strive to get the bill passed as quickly as possible, as the legislation has been linked to the release of the next tranche of a stalled IMF bailout—which is also linked to multi- and bilateral support from “friendly” nations. With foreign exchange reserves at critically low levels, the IMF program is perceived as a vital lifeline if the country is to avoid default and achieve any form of economic stability.

Prior to tabling the mini-budget, the Federal Board of Revenue issued a notification raising federal excise duty on locally manufactured cigarettes, with an aim to generate up to Rs. 60 billion in taxes on tobacco products. The government has also imposed a 1 percent increase in general sales tax, raising it from 17 to 18 percent, with an aim to generate Rs. 55 billion in revenue. The remaining Rs. 55 billion of the Rs. 170 billion required in new taxes would be secured through the mini-budget and would reportedly include additional taxes on airline travel and sugary drinks and see a hike to withholding tax rates.

Related Articles

Leave a Comment