Govt to unveil mini-budget to 'sustain economic growth'

The bill may also facilitate investors and industrialists with certain concessions.

ISLAMABAD (Dunya News) – Finance Minister Asad Umar is expected to announce the “mini-budget” on Wednesday with a possible imposition of new taxes only months after the government had presented its finance bill in September.

The bill is expected to include higher taxes on luxury items, mobile phones, and large cars as well as reduction in sales and income taxes and import duty for various machinery and raw materials in an attempt to boost local industry and assist exporters.

Besides, the bill may also facilitate investors and industrialists with certain concessions.

The package aims to formulate and implement effective measures for increasing investment in the country whose economy has been under intense pressure combined with the balance of payments crisis with foreign exchange reserves sufficient to cover less than two months of imports.

Taxes on import and export of heavy machinery to upgrade the infrastructure of refineries and real estate, and importing required modern machinery for pharmaceutical industry can be reduced for a few years.

It is being expected that Federal Excise Duty (FED) will be imposed on prepaid mobile phone cards and income tax will be increased for the salaried class.

However, the government has planned to provide relief to investors of the stock market in terms of reduction in certain taxes.

Taxes are expected to be increased on the imported and over 1800 CC cars.

Advance income tax on sale and purchase of shares in the stock market may be eliminated and capital gains tax may be reduced.

Refunds and easy trade-related reforms and modifications to facilitate exporters are also a part of the mini-budget.

It is expected that non-filers will be able to buy small cars and for them the withholding tax on banking transactions may be abolished.

New measures and policies concerning the five-year Strategic Trade Policy Framework (STPF) are expected to be announced.

In this regard, the commerce ministry had been working on a new STPF to reduce the cost of production and encourage investment in export-oriented sectors.

The bill also includes a proposal for reducing the regulatory duty on more than 200 raw materials, and salary tax can be restricted to salaried class with an annual income of 12 lakh.

Finance Minister Asad Umar will also inform the house regarding an increase in remittances and exports, trade deficit and reduction in imports.

The parliament will be informed about foreign aids from ‘friend’ countries.

Earlier, the Pakistan Tehreek-e-Insaf (PTI) announced to provide some relief to the general public in the mini-budget.

Anti-Money Laundering (amendment) Bill

In order to curb money laundering in the country, the finance ministry has formulated the ‘Anti-Money Laundering (amendment) Bill’ which is expected to be placed before the parliament today for approval.

According to sources, the proposed bill will increase the punishment of illegal transfer of money from a minimum of three years to maximum of 10 years.

Moreover, the fine imposed on money launderers and their facilitators will be increased from Rs50 lakh to Rs5 crore, if the bill gets approval.

Furthermore, the bill might also enact confiscation of properties of money launderers for up to six months according to directives of the concerned authorities.

To further curb the illegal money transactions and Hawala/Hundi businesses, money launderers would not be able to acquire bail from the courts of law.

It is also being thought that Islamabad, in order to comply with the Financial Action Task Force (FATF) standards and its removal from the organisation’s grey-list, has considered the bill ‘essential’ if they are to increase investment and foreign businesses in the country.

Pakistan has been trying to implement standards set by the FATF, an inter-governmental organisation that underpins the fight against money laundering and terrorist financing.