After a rather dull and uneventful budget by Federal government, Punjab government today presented a very detailed and interesting provincial budget that includes some meaningful steps for the province.
Read More: Budget 2020-21 by Federal Government
Hashim Jawan Baksh presented the budget in assembly among constant chants and slogans by opposition parties. Mr. Baksh highlighted how the efforts of federal and provincial governments were paying off at the start of 2020 with 13% rise in FBR taxes collected than previous year during March and fiscal deficit down by 71%. There was a remarkable improvement of 23% in Punjab revenues compared to last year. The provincial government ensured that Rs. 240 billion were issued for various projects.
CM Punjab, Usman Buzdar took swift steps in response to corona virus situation in the country and changed provincial budget to accommodate maximum population for effects of virus. Rs. 4963 billion from Federal government is expected for Punjab government with NFC award of Rs. 1433 billion.
For the first time Rs. 18 billion tax relief is provided by provincial government along with more than Rs. 25 billion provided for health sector departments including zakat department and PDMA.
In addition, following are the other aspects of budget announced.
- Front line workers are being paid and will be paid 1-month excess salary till they are performing duty.
- Rs. 106 billion is allocated for corona related issues in the province.
- Rs. 56 billion tax relief packages are designed for businesses
- Rs. 50 billion will be provided as direct relief to people.
- The government has launched a GST packages where Health insurance, consultancy fees, hospital taxes that are 16% and 5% are reduced to 0%.
- Punjab government has reduced GST from 16% to 5% for more than 20 services including hotels guest houses, marriage halls and services, IT sector, tour operators, rent-a-car, gyms, textile and leather, consultancy services, photography, and parking services.
- Property builders or developers will pay Rs. 50 per square-feet or 100 square-yard taxes.
- Restaurants or beauty parlors can avail GST reduction offer from 16% to 5% if they use credit/debit card instead of cash. This is an important step in increasing documentation in the province.
- For South Punjab, Additional Chief secretary South Punjab and additional IG for South Punjab Rs. 1 billion 450 million has been allocated for creation of these departments.
- For Health department, Rs. 284 billion 200 million has been allocated with current expenditure 250 billion 700 million while Rs. 33 billion is allocated for development projects.
- To provide relief to health care sector from Covid-19 expenses, Rs. 13 billion and Rs. 26 billion for medicinal needs has been allocated.
- Rs. 12 billion allocated for Insaaf Sehat cards.
- For Education sector more than Rs. 391 billion has been allocated under which current expenses will constitute Rs. 397 billion while Rs. 34 billion are allocated for development projects.
- For School education department, Rs. 350 billion 100 million have been allocated.
- For Agricultural sector, to fight locust attack and other unforeseen catastrophes and Rs. 4 billion has been allocated for this purpose. Rs. 1 billion will be provided to PDMA.
- Rs. 31 billion 730 million are allocated for agricultural sector for subsidies on seeds, water course lines, solar irrigation and drip system and many other projects.
- Rs. 331 billion have been allocated for wheat procurement.
- Property tax can now be paid in bulk payments and if paid together by end of 2020, property owners can get a tax rebate of 10% instead of 5%.
- Entertainment duty to be reduced from 20% to 5%.
- New Property tax valuation table won’t be developed for one year
- Car token if paid in full for one time, 20% rebate will be provided to tax payer instead of 10%. Also, consumers using Punjab e-pay portal for payment can avail 5% discount.
- Land revenue act will be changed for better collection of taxes. Meanwhile, stamp duty is reduced to 1% instead of 5% for helping construction industry.
- For ease of doing business, provincial business license fee is reduced to 0% to enhance business growth.
- Current expenditure has been increased from Rs. 12 trillion 99 billion to Rs. 13 trillion 18 billion which is only an increase of 1.5% from previous year.
- Local government budget is increased by Rs. 10 billion compared to 2019.
- Provincial government has allocated Rs. 337 billion for development budget with Rs. 97 billion 860 million for social services, Rs. 77 billion 860 million for infrastructure development, Rs. 17 billion 350 million for production sector, Rs. 450 million for services sector, Rs. 27 billion 500 million for special program and 250 billion for Public Private Partnership (PPP) programs.
- Under Public Private Partnership (PPP), 135 billion mega projects are to be initiated and completed in short time with Lahore SL4 Ring Road, Multan Vihari Road, Water Meters supply and Rawalpindi Ring Road are some of the projects shortlisted.
- Under PPP, a 10.4 billion SL3 Ring Road is to be completed next year.
- For first five years, there will be no Sales tax on services for Private-Public Partnership program.
- Rs. 6 billion 780 million is allocated for TEVTA, Rs. 1 billion allocated for Hunarmand program and various online courses for youth skill development.
- Social protection authority has been allocated more than Rs. 4 billion. The programs include uplifting programs for elders, acid victims, women programs and Shauhda programs.
- Punjab Human capital investments is starting for extremely poor population with Rs. 1 billion 150 million.
- Punjab municipal services programs gets Rs. 23 billion 200 million for provision of basic facilities.
- Rs. 4 billion 160 million has been allocated for 1122 extension to small towns and cities.
- Rs. 1 billion allocated for Naya Housing scheme.
- Aab-e-pak authority is established with Rs. 2 billion 500 million worth budget for providing safe and clean water. Similarly, for water filters and treatment plants, Rs. 5 billion have been allocated.
- Rs. 2 billion allocated for religious tourism.