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Parliament okays ‘controversial’ budget for FY25 – Pakistan

• Opposition lawmakers term budget ‘unrealistic anti-people and anti-industry’
• Bill empowering ECP to appoint retired judges to election tribunals passed
• Lawmakers give themselves another raise, take away govt’s ability to control their salaries, perks

ISLAMABAD: Tensions gripped the National Assembly on Friday as the House passed the budget for the next fiscal year with some amendments. The motion, introduced by Finance Minister Muhammad Aurangzeb, was preceded by fiery speeches from the opposition, who described the budget as unrealistic, anti-people, anti-industry, and anti-agriculture.

Opposition lawmakers, particularly from the PTI, criticised the budget, asserting that it was now an open secret that the document was dictated by the IMF. They accused the government of coming to power through electoral fraud and claimed it had no right to add to the miseries of the people.

Leader of the Opposition Omar Ayub Khan denounced the budget as “economic terrorism against the people”.

“The economic hitman has prepared the budget and the target are people of Pakistan,” he remarked. “Inflation will increase due to this budget. There will be no economic growth with this budget,” he said, predicting that electricity prices would go up to Rs100 per unit.

In his defence, Mr Aurangzeb highlighted that tax exemptions on medical surgery equipment, educational materials, cardiology stents, and items for the erstwhile Fata and Pata would continue.

He emphasised that exemptions for agricultural inputs like fertilisers and pesticides, as well as for researchers and teachers, would also be retained. He underlined the need to promote pure milk but made it clear that tax exemption could not be given on packaged milk unless it met quality standards.

The House approved 53 supplementary demands for grants pertaining to various ministries and divisions for 2022-23 and 25 demands for the fiscal year 2023-24. Additionally, 26 demands were approved to cover the excess expenditure of various ministries and divisions for 2022-23.

Earlier, responding to the points raised by opposition lawmakers, the finance minister claimed that the economy had achieved macroeconomic stability, adding that the country has achieved macroeconomic stability. “We will lead the country towards sustainable economic growth by continued stability,” he said.

He pointed to a reduction in the current account deficit and controlled fiscal deficit, along with a stable currency over the past six to seven months. He noted that foreign exchange reserves had reached $9 billion, and inflation had decreased to 11 per cent from 38 per cent.

He said enhancing the tax-to-GDP ratio and reforms in state-owned enterprises and the energy sector were part of the next fiscal year’s budget. Besides, the privatisation process would be completed within three years.

The minister reiterated the tax-to-GDP ratio would be increased to 13pc in the next three years. He said enhanced revenue collection was a must to move towards self-reliance and say goodbye to the International Monetary Fund (IMF). He said the government was committed to reconstructing and digitising the Federal Board of Revenue (FBR) to increase the tax-to-GDP ratio.

Mr Aurangzeb said that there would be no “non-filer” category in the tax system and everyone would eventually have to pay tax. He said tax evasion would be checked and the tax net would be increased for retailers and the real estate sector.

Bringing exporters under normal taxation would not affect exports, he insisted, stressing that tax would be levied on their income and those who do not earn would still pay zero tax.

He said that the salaried class pays more taxes than all exporters combined.

In a move that sparked controversy, the House passed the Elections Act (Amendment) Bill 2024, empowering the Election Commission of Pakistan (ECP) to appoint retired high court judges as election tribunals. The bill, introduced by Minister for Parliamentary Affairs Azam Nazeer Tarar, was fast-tracked through a supplementary agenda with suspended rules for immediate consideration.

Mr Tarar said the amendment was aimed at expediting the settlement of petitions pertaining to elections of the National Assembly, Senate, provincial assemblies, and local governments. He explained that due to the workload on serving judges, the proposed amendment seeks to restore the original provision of Section 140, making retired high court judges eligible for appointment as election tribunal members.

PTI Chairman Barrister Gohar Ali objected, citing a Supreme Court judgement that no tribunal-related changes could be made to the law on which elections are held. Mr Tarar, however, insisted that legislation was the exclusive domain of parliament, asserting that “no court can dictate this House”.

Aliya Kamran of JUI-F criticised the government’s approach, suggesting it reinforced allegations of manipulated electoral outcomes. “This is why they do not want tribunals comprising serving judges of the high courts,” she remarked.

Lawmakers give themselves a raise

Through an amendment to the Finance Bill 2024, the National Assembly also approved an amendment regarding increase in the perks and privileges of lawmakers, with a majority vote. The amendment had been moved by Abdul Qadir Patel of the PPP and it was opposed by the opposition members belonging to the PTI.

Through the amendment, the power of the federal government to determine the salaries and perks and privileges of parliamentarians has transferred to the respective finance committees of the house.

According to the amendment, the travel allowance of MNAs has been increased from Rs10/km to Rs25/km. It has been declared that unutilised air tickets of members will not be cancelled and would remain valid for another year.

Published in Dawn, June 29th, 2024


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