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2024–25 Pakistan federal budget

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2024–2025 (2024–2025) Pakistan Federal Budget
State emblem of Pakistan
Submitted12 June 2024
Submitted byMuhammad Aurangzeb
Debt paymentRs. 9,800 billion
Deficit6.9% of GDP
2025–2026›

The 2024–25 Pakistan Federal Budget is a financial statement of the government's estimated receipts and expenditures for the fiscal year that runs from 1 July 2024 to 30 June 2025.[1][2]

On 12 June 2024, finance minister Muhammad Aurangzeb presented the federal budget with a total outlay of Rs18.877 trillion.[3] The same day, a copy of the finance bill was moved in the Senate.[4] On 28 June 2024, the National Assembly passed the finance bill.[5][6] On 30 June 2024, President Asif Ali Zardari gave assent to the finance bill.[7]

Overview

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The upcoming budget is expected to be a critical one as it is being prepared under the strict conditions of the International Monetary Fund (IMF). The budget is expected to be contractionary, aiming to close the gap between revenue collection and total expenditure. The budget is being prepared with the aim of securing a bailout package from the IMF.[8][9]

On 10 June 2024, the National Economic Council (NEC) decided to continue funding ongoing provincial projects and constituency-based schemes, while approving a 47 percent increase in the federal Public Sector Development Programme to Rs 1.4 trillion.[10]

The NEC also approved the economic growth target of 3.6 percent.[11]

IMF bailout

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Main article: Pakistan and the International Monetary Fund

Pakistan is in talks with the IMF for a loan of between $6 billion and $8 billion. This budget is very important for Pakistan's IMF program.[8] The government is required to restrict budget deficits to 5% to 6% of GDP and achieve a primary surplus to meet the IMF's requirements.[12]

Taxation

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The government is all set to collect an additional Rs2,000 billion in revenue by imposing new taxes.[13] The middle-income and high-income groups will face difficulties with additional taxes imposed. The new budget proposes to levy 18% GST on retailers, agricultural implements, seeds, fertilizers, tractors, and other equipment.[9]

Deficit management

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The new proposed federal budget of Rs18,900 billion will be based on a deficit of Rs9800 billion.[9] The government is required to restrict budget deficits to 5% to 6% of GDP.[12]

References

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  1. ^ "Federal budget to be presented on June 12, totaling around Rs18t". The Express Tribune. 4 June 2024.
  2. ^ "Pakistan all set to present budget on June 12". ARY News. 10 June 2024.
  3. ^ "Finance Minister Aurangzeb presents Rs18.9tr federal budget 'in line with IMF guidelines'". DAWN. 12 June 2024.
  4. ^ Shaheen, Sardar Sikander (13 June 2024). "Finance Bill 2024 laid in Senate". Business Recorder.
  5. ^ "NA passes tax-laden budget ahead of talks on fresh IMF loan". DAWN. 28 June 2024.
  6. ^ Khan, Iftikhar A. (29 June 2024). "Parliament okays 'controversial' budget for FY25". DAWN.
  7. ^ Guramani, Nadir (30 June 2024). "President Zardari gives assent to tax-laden finance bill". DAWN.
  8. ^ a b "Pakistan's budget will aim to set stage for IMF bailout". The Express Tribune. 10 June 2024.
  9. ^ a b c "Middle class to bear brunt of new budget with steep inflation, increased GST".
  10. ^ Kiani, Khaleeq (11 June 2024). "Budget 2024-25: NEC approves Rs3.8tr PSDP to boost economy". DAWN.
  11. ^ Rana, Shahbaz (10 June 2024). "Budget 2024-25: NEC approves Rs3.5 trillion development budget". The Express Tribune.
  12. ^ a b "Budget 2024-25: Managing the deficit". www.geo.tv.
  13. ^ "Govt likely to impose Rs2,000bn of taxes in budget 2024-25".
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