New initiatives proposed in the national budget for 2017-18

ISLAMABAD: Following are the new initiatives, proposed in the national budget for 2017-18, unveiled by Finance Minister Senator Muhammad Ishaq Dar at the Parliament House here Friday:

WELFARE

Welfare scheme for family of martyrs - CDNS - preferred profits will be offered Scheme for disabled persons.

Loan write-off of widows - HBFC - upto Rs. 500,000

Facilitating elderly, widows and pensioners - CDNS - IT, online connectivity, and alternative service delivery mechanisms - ATMs, mobile, etc.

Overseas Pakistanis - non-convertible bond, an exclusive sector in Islamabad by CDA

BISP Beneficiary Graduation Programme - Grants to willing self-employed individuals

– Rs. 50,000 grant per family will be provided to 250,000 families in the first phase. Provision of off-grid solar solutions in sparsely populated areas, especially Balochistan

AGRICULTURE

Continuation of subsidized electricity for agri-tube wells

Single-digit (9.9pc) mark-up rate for farmers utilizing loans up-to Rs. 50,000

Continuation of subsidy on electricity to low-income and low-usage Customers

Credit to agriculture sector - increased from Rs. 700 billion target of the current year to Rs.1,001 billion

FINANCIAL INCLUSION

Financial inclusion - loans to low-income segments through micro-finance banks, exemption from WHT on branchless banking agents

INFORMATION TECHNOLOGY

Setting up of an IT Park IT export houses/companies shall be allowed to open Foreign Exchange Accounts in Pakistan Reduction of the withholding income tax on cell phone call from 14pc to 12.5pc and Federal Excise Duty from 18.5pc to 17pc Smart/android phones - custom duty to be reduced from Rs. 1,000 to Rs. 650.

Import duty is being reduced on mobile telecom products.

The start-up software houses shall be exempted from Income Tax for the first 3 years

Exports of IT services from Islamabad and other Federal territories shall be exempted from SalesTax

OTHERS

Minimum wage of labour increased from Rs.14,000 per month to Rs. 15,000 per month

Bait-ul-Maal allocation increased by 50pc from Rs. 4 billion to Rs.6 billion

Risk sharing guarantee scheme - house building finance

TEXTILES

To stabilize cotton prices in the country, a system of cotton hedge trading for the domestic cotton will be initiated. Launch of Brand Development fund for textile sector

The approval process of establishment of 1,000 stitching units has been completed and its implementation will start during FY 2017-18 and shall be completed in three years;

Online textile business/trade portal for textiles using B2B (business to business) and B2C (business to consumer) mode

INFRASTRUCTURE FINANCE

Establishment of Pakistan Infrastructure Bank

FINANCIAL INCLUSION STRATEGY

A Rs.8 billion fund will be created at the State Bank of Pakistan to provide loans to low-income segments through microfinance banks;

In order to facilitate transactions through mobile banking, e-gateway systems, mobile banking, the Government is establishing a state-of-the-art e-gateway systems at the State Bank of Pakistan at a cost of Rs.200 million.

Technical training and handholding of the service delivery organisations shall also be undertaken through this project;

Exemption from withholding tax on Cash Withdrawals by Branchless Banking Agents- exemptions on withholding tax will be given on withdrawal of cash from branchless banking;

Pakistan Micro Finance Investment Company: The Government of Pakistan in 2016 launched Pakistan Microfinance Investment Company (PMIC) jointly with DFID and KFW to augment the availability of capital for Micro Finance institutions. It is estimated that this will lead to doubling of small loans;

SMALL AND MEDIUM ENTERPRISES

Establishment of Risk Management Facility

Innovation Challenge Fund

Secure Transaction for moveable property

SALES TAX REFUND

Sales tax refunds: All the pending sales tax refunds whose RPOs have been sanctioned by 30th April 2017, shall be paid in two parts.

RPOs upto the value of Rs.1 million will be paid till 15 July, and the remaining RPOs will be paid till 14th August 2017.