Salient features of budget 2021-22

Minimum wage increased to Rs. 20,000 per month

ISLAMABAD (Dunya News) – Following are the salient features of budget 2021-22 presented by Minister for Finance and Revenue Shaukat Tarin in the Parliament House on Friday.

From first of July 2021 all government employees to get 10% adhoc relief allowance From first of July 2021 pension to get 10 percent raise From grade 1 to 5 government allowance to get increase allowance to Rs 900 from Rs 400 Minimum wage has been increased to Rs 20000 per month On 300 active pharmaceutical industries have been exempted from customs duties On several raw material used in industries has been either exempted or duties have been reduced Total incentives due to lowering of duty will amount to Rs 25 billion a year Tax lowered on warehousing, logistics services and collateral from 8% to 3% Withholding exempted on Electronic warehouse receipts of PME Telecommuincation sector has been given industrial status Special technology Zone would be established aimed with 10 year tax holiday Imports of capital goods would be duty free for technology zones SMEs having a turnover of Rs 100 million per year have to pay tax of 0.25% Sme turnover of rs 100 million to Rs 250 million tax levy of 0.5% Government to introduce one pager tax return document for SME IT sector would be for freelance and other services Final regime tax for IT sector would be 1percent and no question would be asked Wholesaler and retailers and AOPs minimum tax limit has been increased Minimum tax level has been raised to Rs 100 million Proposed that turnover tax and withholding tax will be levied on other sector which are active payer list Number of Real time point of sale in two years will be increased to 500,000 from 11000 retailers Propose on individuals and AOPs minimum tax rate to be raised from Rs 10 million to Rs 100 million Introduction of self assessment scheme, E-audit system and a strict adherence to no harassment for taxpayers No new taxes on salaried class Tax rate to be reduced to 1.25% from 1.5% Promotion of third party audits and minimizing requirements for tax compliance Expansion of GST base and introduction of new simplified Tax Return Form and new tax code Every year tax rate will be reduced Capital gains tax has been reduced to 12.5% to 15% Withholding tax on mobile phone reduced to 10% from 12.5% Tax rate will be reduced to 8% Withdrawal of FED and reduction of sales tax on locally manufactured cars upto 850cc Allowing zero rating to export of IT services Exemption to SILOS for storage of agriculture products Reduction in withholding tax regime by 40% Exemptions on COVID-19 related medical equipment / items have been extended for six months Federal excise duty has been imposed on usage of over three minute calls and SMS Withholding tax on 12 sectors have been removed Sectors are banking transactions, PSX, margin financing, air travel service, debit and credit cards on overseas buying Sales tax on 850 cc cars reduced to 12.5% from 17% Increase in development budget from Rs 630 billion to Rs 900 billion For Food Security; Rs 1 billion for Locust Emergency and Food Security Project, Rs 2 billion for enhancing productivity of rice, wheat, cotton, sugarcane and pulses, Rs 1 billion for enhancement of olive cultivation on commercial scale Rs 3 billion for improvement of water courses Rs 100 billion allocated for construction of four hydro power dams (Dasu, Diamer, Mohmand, Neelum Jhelum) Gross Revenues for 2021-22 have been estimated at Rs 7,909 billion FBR revenues are estimated to grow by 24% from Rs 4,691 billion to Rs 5829 billion Federal expenditures are budgeted at Rs 8,487 billion compared to Rs 7,341 billion Subsidies are projected at Rs 682 billion Allocation of Rs 260 billion for Ehsaas, 24% increased Expenditure priorities: Vaccinations $ 1.1 billion, Universal Health Coverage in collaboration with Provinces Rs 12 billion for collateral free lending to SME, Rs 10 billion for Kamyab Pakistan Program, Rs 100 million for anti-rape fund Rs 66 billion for Higher Education Commission budget