LAHORE: Punjab government will present a surplus budget for financial year 2021-22 with a volume of around Rs 2,600 billion with Rs 560 billion development programme.
Sources privy to the budget matters said on Sunday that upcoming budget would be Rs 359.4 billion (16.04 percent) higher than the current financial year 2020-21. They said that Punjab would receive Rs 1691 billion from the federal divisible pool under the National Finance Commission (NFC) Award.
While, the total provincial revenue target had been set at Rs 360 billion for FY 2021-22 which would be Rs 26.9 billion higher than the total revenue collection of Rs 333.1 billion of the current FY 2020-21. They explained that out of Rs 360 billion, the provincial revenue receipts were estimated at Rs 260 billion and Rs 100 billion would be collected from other sources.
The sources said that development budget for the next financial year would be around Rs. 560 billion, which was Rs. 158 billion more than the revised development budget of Rs. 402 billion of the current financial year. Giving break-up of Annual Development Plan (ADP), they elaborated that Rs 144 billion would allocated for ongoing/current developmental schemes; Rs. 167 billion for new development schemes; Rs 100 billion for district development programme; Rs 44 billion for other/miscellaneous development programmes; Rs 83 billion for development schemes initiated through foreign assistance; and Rs. 25 billion for development schemes under public-private partnership.
Like the federal government, they added, the Punjab government would also give a 10 percent raise in salary and pension to provincial employees. The Punjab government had decided to reduce sales tax rate in many sectors and maintain Punjab Infrastructure Development Cess to promote business activities in the province, they said and added the areas in which sales tax would be reduced/abolished included insurance agents and brokers, and entertainment sector.
The sources said that it was proposed to impose five percent GST on services of insurance agents and brokers, while GST rate on entertainment should be reduced to zero. Similarly, non-tax exemptions to inter-city carriage of goods in Punjab would be abolished. They mentioned that 15 percent GST was levied on inter-city carriage of goods.
The next budget also proposed to reduce sales tax on call centers to 16 percent from 19.5 percent; tax on laundry and dry cleaners should be reduced to 5 percent; tax on rental builders and crane services, and stitching services should be lowered to five percent from 16 percent.