PESHAWAR:
The Khyber Pakhtunkhwa (KP) government on Saturday presented a Rs404.8
billion budget for the financial year 2014-15 earmarking Rs80 billion
for education and increasing salaries and pensions.
The budget proposed a levy of 5 percent to 17.5 percent slabs of agriculture income tax and increase in provincial taxes, fees and royalties.
Senior Minister Sirajul Haq, who also holds the portfolio of Finance, while presenting the budget in the provincial assembly, said the development outlay of Rs139.8 billion for the next fiscal reflected an 18 percent increase over the current financial year.
The finance minister said the government was happy to announce that no new tax had been imposed in the budget 2014-15 on low-income people.
However, the finance bill presented with the budget reflected an upward revision in taxes on services, land, movable and immovable properties, guest houses, restaurants, petrol and CNG filling stations, cell phone companies’ towers and services.
The provincial government will collect agricultural income tax at the rate of 5 percent from every owner of agriculture land where total taxable amount exceeds Rs400,000.
Where total taxable income exceeds Rs550,000, but does not exceed Rs750,000, land owners will pay Rs7,500 plus 10 percent on an amount exceeding Rs550,000 and the owner whose taxable income exceeds Rs750,000, but does not exceed Rs950,000 will have to pay Rs22,500 plus 10 percent agriculture income on the exceeding amount.
Similarly, the total taxable income exceeding Rs950,000, but that does not exceed Rs1,100,000 will be taxed Rs42,500 plus 15 percent on agriculture income on the exceeding amount.
According to the finance bill, a land owner whose taxable income exceeds the amount of Rs1,100,000 will pay Rs6,500 plus 17.5 percent on the exceeding amount.
Announcing the upward revision in various taxes, Siraj said that increase in provincial revenue was inevitable due to which the increase in the ratio of existing taxes has been proposed.
He said an increase in the capital value tax on the transaction of urban immovable property (UIP) was proposed because the ratio in the current budget was fairly low.
According to the finance bill, immovable properties have been divided into 12 categories wherein the tax rate for areas in the provincial metropolis as notified by the government in category A up to 5 marlas (other than self-occupied) has been determined at Rs1,000 per annum, in B-Rs 900 and C (townships) Rs750, exceeding 5 marlas will pay Rs1,700 in A, Rs1,600 in B and Rs1,500 in category C, while 10 marlas’ owner will pay Rs2,200 in category A, Rs2,100 in B and Rs2,000 in C category.
The owners of 15 marlas will pay Rs3,300 in A, Rs3,200 in B and Rs3,000 in category C, while those of the 18 to 20 marlas houses and flats will be taxed at the rate of Rs10,000 in category A, Rs9,000 in B, Rs8,000 in category C. Similarly other eight categories have different tax slabs for the immovable properties.
The budget outlay, showing a 18 percent increase over the last budgetary allocations, also proposed a 10 percent increase in the salaries of employees in line with the federal government decision, and 20 percent increase in the medical allowance of grade-1 to 15 and 5 percent in their conveyance allowance, while a premature increment to grade 1 to 4 employees has also been proposed in the budgetary allocations.
Also, in line with the federal government decision, the minimum wage for labourers has also been proposed at Rs12,000.
Sirajul Haq said the provincial government was working out the modalities of Rs6 billion pro-poor initiative under which the poor will get a subsidy on food items. He said under the package, the deserving will get a monthly Rs10 subsidy on per kg flour and Rs40 for per kg ghee and four million people will benefit from the scheme.
He said like the previous year, the 2014-15 budget had also been segregated into three parts, welfare, administration and development with the main focus on its welfare portion for which a sum of Rs219.69 billion, that is 54.27 percent of the total budget, while Rs45.30 billion had been set aside for administration, that is 11.19 percent of total budget, showing an increase of 16.08 percent over the current budget.
The minister said Rs139.8 had been allocated for the development portion which is 34.54 percent of the total budget outlay reflecting an increase of 18.48 percent over the development allocations for the current fiscal. The provincial government would prioritise the ongoing projects to decrease the liability of throw-forward.
The upbeat finance minister, and Amir the Jamaat-e-Islam (JI), a coalition partner of the Pakistan Tehreek-e-Insaf (PTI) in the province, hinted at initiating good governance and the elimination of corruption in the province.
He termed the budget balanced, as both the expenditures and revenue receipts in the financial year 2013-14 have been estimated at Rs404.8 billion apiece.
The minister said general revenue receipts for the next fiscal year included Rs227.12 billion under the federal tax assignment which was 14.55 percent higher than the current fiscal.
He said Rs12 billion receipts are expected as net profit on hydel power generation along with the expected receipt of Rs32.27 billion as arrears of net hydel profit, Rs29.26 billion as straight transfers as royalty on oil and gas produced in the southern districts that is 6.4 percent higher than the current year.
Rs27.29 billion special grants for the war on terror that is also 14.55 percent higher than the current year’s war subvention is also expected to be received during the next fiscal, Siraj said.
He said the province expected to receive in its own receipts of Rs12 billion as GST on services showing an increase of 100 percent, Rs2.85 billion as profit from the hydel power generation projects in the province and Rs35.35 billion as foreign project assistance, besides Rs727 million from other resources.
The minister said the budget carried expenditure of Rs404.8 billion in which Rs265 billion had been allocated for current expenditure; while other expenditure recording an increase of 17.26 percent include Rs25.2 billion for health, Rs80.72 billion for education, Rs28.53 billion for police, Rs30 billion for payment of pensions, Rs13.9 billion for payment of mark-up on loans, Rs3.20 billion for irrigation sector, Rs2.17 billion for technical education and training and Rs5.26 billion for works and communication.
The environment sector will get Rs1.65 billion, agriculture Rs3.14 billion, while Rs2.500 billion was set aside as food subsidy for wheat procurement and Rs1.11 billion will be spent on social welfare and women’s development sector showing an increase of 20 percent, Siraj said.
The budget proposed a levy of 5 percent to 17.5 percent slabs of agriculture income tax and increase in provincial taxes, fees and royalties.
Senior Minister Sirajul Haq, who also holds the portfolio of Finance, while presenting the budget in the provincial assembly, said the development outlay of Rs139.8 billion for the next fiscal reflected an 18 percent increase over the current financial year.
The finance minister said the government was happy to announce that no new tax had been imposed in the budget 2014-15 on low-income people.
However, the finance bill presented with the budget reflected an upward revision in taxes on services, land, movable and immovable properties, guest houses, restaurants, petrol and CNG filling stations, cell phone companies’ towers and services.
The provincial government will collect agricultural income tax at the rate of 5 percent from every owner of agriculture land where total taxable amount exceeds Rs400,000.
Where total taxable income exceeds Rs550,000, but does not exceed Rs750,000, land owners will pay Rs7,500 plus 10 percent on an amount exceeding Rs550,000 and the owner whose taxable income exceeds Rs750,000, but does not exceed Rs950,000 will have to pay Rs22,500 plus 10 percent agriculture income on the exceeding amount.
Similarly, the total taxable income exceeding Rs950,000, but that does not exceed Rs1,100,000 will be taxed Rs42,500 plus 15 percent on agriculture income on the exceeding amount.
According to the finance bill, a land owner whose taxable income exceeds the amount of Rs1,100,000 will pay Rs6,500 plus 17.5 percent on the exceeding amount.
Announcing the upward revision in various taxes, Siraj said that increase in provincial revenue was inevitable due to which the increase in the ratio of existing taxes has been proposed.
He said an increase in the capital value tax on the transaction of urban immovable property (UIP) was proposed because the ratio in the current budget was fairly low.
According to the finance bill, immovable properties have been divided into 12 categories wherein the tax rate for areas in the provincial metropolis as notified by the government in category A up to 5 marlas (other than self-occupied) has been determined at Rs1,000 per annum, in B-Rs 900 and C (townships) Rs750, exceeding 5 marlas will pay Rs1,700 in A, Rs1,600 in B and Rs1,500 in category C, while 10 marlas’ owner will pay Rs2,200 in category A, Rs2,100 in B and Rs2,000 in C category.
The owners of 15 marlas will pay Rs3,300 in A, Rs3,200 in B and Rs3,000 in category C, while those of the 18 to 20 marlas houses and flats will be taxed at the rate of Rs10,000 in category A, Rs9,000 in B, Rs8,000 in category C. Similarly other eight categories have different tax slabs for the immovable properties.
The budget outlay, showing a 18 percent increase over the last budgetary allocations, also proposed a 10 percent increase in the salaries of employees in line with the federal government decision, and 20 percent increase in the medical allowance of grade-1 to 15 and 5 percent in their conveyance allowance, while a premature increment to grade 1 to 4 employees has also been proposed in the budgetary allocations.
Also, in line with the federal government decision, the minimum wage for labourers has also been proposed at Rs12,000.
Sirajul Haq said the provincial government was working out the modalities of Rs6 billion pro-poor initiative under which the poor will get a subsidy on food items. He said under the package, the deserving will get a monthly Rs10 subsidy on per kg flour and Rs40 for per kg ghee and four million people will benefit from the scheme.
He said like the previous year, the 2014-15 budget had also been segregated into three parts, welfare, administration and development with the main focus on its welfare portion for which a sum of Rs219.69 billion, that is 54.27 percent of the total budget, while Rs45.30 billion had been set aside for administration, that is 11.19 percent of total budget, showing an increase of 16.08 percent over the current budget.
The minister said Rs139.8 had been allocated for the development portion which is 34.54 percent of the total budget outlay reflecting an increase of 18.48 percent over the development allocations for the current fiscal. The provincial government would prioritise the ongoing projects to decrease the liability of throw-forward.
The upbeat finance minister, and Amir the Jamaat-e-Islam (JI), a coalition partner of the Pakistan Tehreek-e-Insaf (PTI) in the province, hinted at initiating good governance and the elimination of corruption in the province.
He termed the budget balanced, as both the expenditures and revenue receipts in the financial year 2013-14 have been estimated at Rs404.8 billion apiece.
The minister said general revenue receipts for the next fiscal year included Rs227.12 billion under the federal tax assignment which was 14.55 percent higher than the current fiscal.
He said Rs12 billion receipts are expected as net profit on hydel power generation along with the expected receipt of Rs32.27 billion as arrears of net hydel profit, Rs29.26 billion as straight transfers as royalty on oil and gas produced in the southern districts that is 6.4 percent higher than the current year.
Rs27.29 billion special grants for the war on terror that is also 14.55 percent higher than the current year’s war subvention is also expected to be received during the next fiscal, Siraj said.
He said the province expected to receive in its own receipts of Rs12 billion as GST on services showing an increase of 100 percent, Rs2.85 billion as profit from the hydel power generation projects in the province and Rs35.35 billion as foreign project assistance, besides Rs727 million from other resources.
The minister said the budget carried expenditure of Rs404.8 billion in which Rs265 billion had been allocated for current expenditure; while other expenditure recording an increase of 17.26 percent include Rs25.2 billion for health, Rs80.72 billion for education, Rs28.53 billion for police, Rs30 billion for payment of pensions, Rs13.9 billion for payment of mark-up on loans, Rs3.20 billion for irrigation sector, Rs2.17 billion for technical education and training and Rs5.26 billion for works and communication.
The environment sector will get Rs1.65 billion, agriculture Rs3.14 billion, while Rs2.500 billion was set aside as food subsidy for wheat procurement and Rs1.11 billion will be spent on social welfare and women’s development sector showing an increase of 20 percent, Siraj said.
