Mini budget discussion

[ghazi52]

Main points of Mini Budget

- Tax on income from loans to SME sector to be reduced to 20%

- Agricultural tax will be dropped to 20 per cent.

-To provide low-income housing, loans will be decreased to 20 per cent. Rs5 billion revolving fund will be introduced.

- Withholding tax for filers on banking transactions will be eliminated to encourage the culture of paying taxes.

- Non-fillers will be able to purchase small and mid-size cars up to 1300CC, but the tax would be increased.

- Tax has been decreased to Rs5000 for small wedding halls up to 500 square feet.

- Pilot scheme to be introduced in Islamabad to facilitate traders in filing and paying taxes.

- Duty on import of newsprint eliminated.

- Special economic zones have been formed keeping in mind the interest of CPEC.

- In the next 5 years, those working to produce products for renewable energy will be exempt from sales tax and customs duty.

- No tax on bids for sports franchises until profitability.

- From July 1 super tax will be eliminated for non-banking companies.

- Continuation of 1pc per annum reduction in corporate income tax.

- Tax will be increased for vehicles over 1800CC

- Tax for low priced phones will be decreased, will remain the same for expensive phones.

- Scheme to be introduced of promisory notes for exporters. Any exporter will be able to take loans from banks on these notes.

 

[VCheng]

Main points of Mini Budget

- Tax on income from loans to SME sector to be reduced to 20%

- Agricultural tax will be dropped to 20 per cent.

-To provide low-income housing, loans will be decreased to 20 per cent. Rs5 billion revolving fund will be introduced.

- Withholding tax for filers on banking transactions will be eliminated to encourage the culture of paying taxes.

- Non-fillers will be able to purchase small and mid-size cars up to 1300CC, but the tax would be increased.

- Tax has been decreased to Rs5000 for small wedding halls up to 500 square feet.

- Pilot scheme to be introduced in Islamabad to facilitate traders in filing and paying taxes.

- Duty on import of newsprint eliminated.

- Special economic zones have been formed keeping in mind the interest of CPEC.

- In the next 5 years, those working to produce products for renewable energy will be exempt from sales tax and customs duty.

- No tax on bids for sports franchises until profitability.

- From July 1 super tax will be eliminated for non-banking companies.

- Continuation of 1pc per annum reduction in corporate income tax.

- Tax will be increased for vehicles over 1800CC

- Tax for low priced phones will be decreased, will remain the same for expensive phones.

- Scheme to be introduced of promisory notes for exporters. Any exporter will be able to take loans from banks on these notes.

And yet no one cares to estimate the economic impact for raising revenues as a result of these steps. I wonder why?

@Nilgiri Any way to estimate the impact?

 

[Verve]

The real question is what is the estimated impact on government fiances by the steps just announced? Is it going to be enough to avoid going to the IMF or not?

Details of financial support from China won't be released anytime soon. Call it The Martial plan for Pakistan, if you must.

Without coverage of the impact this mini budget wouldn't have been released.

 

[VCheng]

Details of financial support from China won't be released anytime soon. Call it The Martial plan for Pakistan, if you must.

Without coverage of the impact this mini budget wouldn't have been released.

That would a great achievement indeed for getting through such a tough financial year without resorting to the IMF yet again. And then of course comes the next fiscal year.

 

[Syed1.]

Pakistan is rising. 10 years of PTI will make Pakistan stand on her own feet inshallah.

 

[Verve]

And then of course comes the next fiscal year.

And the marshall plan continues in the next fiscal year!

 

[VCheng]

And the martial plan continues in the next fiscal year!

No worries then, we can discuss the results by then. Great!

 

[maithil]

Khurram Hussain from DAWN has some interesting take on this. However he has always been sceptical of current govt's fiscal management.

 

[VCheng]

Khurram Hussain from DAWN has some interesting take on this. However he has always been sceptical of current govt's fiscal management.

He said this:

"The mini budget is a passing affair. It will contain a few incentives here and there. The real story the government has to deliver is the lasting one, and without credible plans on these three crucial areas, it makes no difference what tweaks they’re bringing to the structure of taxes and customs duties."

He may very well be right.

 

[ziaulislam]

What kinda idiotic believes IMF lends at zero..are they nuts..this is childish and purelt stupif

 

[ziaulislam]

He said this:

"The mini budget is a passing affair. It will contain a few incentives here and there. The real story the government has to deliver is the lasting one, and without credible plans on these three crucial areas, it makes no difference what tweaks they’re bringing to the structure of taxes and customs duties."

He may very well be right.

Which three areas?

 

[VCheng]

Which three areas?

https://www.dawn.com/news/1459476/beyond-tweaks-and-turns

Circular debt, provincial transfers, and the trade deficit.

 

[ziaulislam]

https://www.dawn.com/news/1459476/beyond-tweaks-and-turns

Circular debt, provincial transfers, and the trade deficit.

1. Trade deficit: So export package he doesnt know about? chinse export package? SME tax cutting half ? Agriculture tax? Rice exports BRT seed? is for what..this is pure ignorance. He does know that only way to decrease imports is local mobilization and production. 90% measures in this minibill were for this reason alone

2. Provincial transfers ..there is no solution (2/3 majority needed) apart from central govt letting going things it use to do(decrease federal PSDP and let provinces spend money)..which seems the govt is doing already...simple solution that federal govt should stop spending and ask provinces to spend the same money ..its simple fix

3. Circular debt..i agree dont see solid work yet in this field, they have announced that policy paper will be out in march. Though situation is getting better mostly due to low oil prices and LNG mobilization
The four things that have happened are
A. All tax removed on renewable energy which is suppose to be cheaper
B. Gas terminals building MOU signing expected
C. Comitte made to fast track KESC transfer
D. The whole policy paper made by asian bank which was being blocked by previous govt is now allowed which is 800M$ loan that will do a complete overhaul of distribution system is already being implemented

So its true govt isnt doing much on circular debt yet but the amount its done in 3 months is more than what happened in 10years

 

[VCheng]

1. Trade deficit: So export package he doesnt know about? chinse export package? SME tax cutting half ? Agriculture tax? Rice exports BRT seed? is for what..this is pure ignorance. He does know that only way to decrease imports is local mobilization and production. 90% measures in this minibill were for this reason alone

2. Provincial transfers ..there is no solution (2/3 majority needed) apart from central govt letting going things it use to do(decrease federal PSDP and let provinces spend money)..which seems the govt is doing already...simple solution that federal govt should stop spending and ask provinces to spend the same money ..its simple fix

3. Circular debt..i agree dont see solid work yet in this field, they have announced that policy paper will be out in march. Though situation is getting better mostly due to low oil prices and LNG mobilization
The four things that have happened are
A. All tax removed on renewable energy which is suppose to be cheaper
B. Gas terminals building MOU signing expected
C. Comitte made to fast track KESC transfer
D. The whole policy paper made by asian bank which was being blocked by previous govt is now allowed which is 800M$ loan that will do a complete overhaul of distribution system is already being implemented

So its true govt isnt doing much on circular debt yet but the amount its done in 3 months is more than what happened in 10years

Well, he wrote that before AU's speech. May be he will write more after analyzing the full details as they become evident.

 

[koolio]

This is interesting analysis on the mini budget and this shit corrupt media is hell bent on destabilising GOP