K-P declares federal budget ‘anti-poor’

CM’s aide says Centre trying to please IMF

Our Correspondent June 15, 2024
Though a section of economists have opposed the new IMF loan in a bid to avoid increase in inflation and poverty, and demanded a homegrown economic roadmap, any delay in securing the loan will increase the risk of default. photo: REUTERS


Advisor to Khyber-Pakhtunkhwa (K-P) Chief Minister on Finance Muzammil Aslam has said that common people had been hit hard economically in the federal budget and his own life and business would be greatly affected by the budget.

The finance adviser said the federal budget did not include any plan by the government as it had been prepared at the behest of the International Monetary Fund (IMF) while ignoring the welfare of the middle and poor segments of society.

The advisor claimed that the federal government had followed in the footsteps of K-P as far as pension reforms were concerned.

“New government employees at the Centre will be employed under a contributory pension. The federal budget has put more burden on the salaried class. The tax rate has been increased from 35 to 45 per cent,” he shared, adding that the slabs of the salaried class had also been changed and the capital gains tax raised, and the tax on real estate had been increased to 15 per cent for the first time and to 45 per cent for non-filers.

Non-filers belong to the low income group and a 45 per cent tax is tantamount to cruelty on poor people, he said, adding that 38 per cent tax had been increased in the federal budget on the IMF’s instructions.

He claimed that non-tax revenue had been increased to Rs3,587 billion, which was the main reason for inflation, that all sectors would be affected by the increase in taxes, and that, after payment to the provinces, the income of the federal government would be Rs9,111 billion while the interest payment this year was Rs9,700 billion.

The Finance Advisor said that the federal government’s income couldn’t even pay the interest, and that Rs593 billion had been earmarked for the Benazir Income Support Programme (BISP) which would benefit 10 million people instead of 9.3 million which was not a big deal.

In the budget, he said, only Rs5 billion markup sharing had been given in agriculture, and that there was a 4.5 per cent negative agricultural growth which would make food items expensive.

He said the 12 per cent inflation target in the budget was not good and would lead to higher inflation. Describing the federal budget as an anti-people budget, Muzammil Aslam said it was a collection of contradictions.

He said the federal budget was ‘anti-people, anti-employment and anti-development’ as well as a collection of contradictions that he rejected,  adding that a tax target of Rs 12,970 billion had been set on items that were used by the majority of people.

Muzammil Aslam further said that, though the end of tax exemptions was welcome, the return of tax exemptions was not equal to the relief given to the public. The change in salary tax slabs, he added, was once again an attack on the honest, that the removal of exemptions on exporters would affect domestic exports, that the 45 per cent real estate tax (CGT) would create chaos in the market as it would encourage cash transactions, and that the addition of a late filer category after the non-tax filer one was another mistake.

Regarding increasing the price of petrol in the federal budget, the Finance Adviser said that raising the petrol levy to Rs80 was yet another attempt to burden the public.

He called the 25 per cent and 22 per cent increases in salaries a big relief for government employees but said it would affect surpluses of the provinces.


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