The government is benefiting from a delay in the passage of the second amendment finance bill 2019 as the projected revenue loss exceeds projected expenditure of the bill. An estimated revenue loss of Rs 1 to 2 billion every month (Rs 24 billion per annum) is projected for a delay in the passage of the bill while the projected expenditure is estimated at Rs 6.8 billion by the government and over Rs 140 billion by independent economists per annum.
The bill 2019 was tabled before the National Assembly on January 23. The bill envisages few revenue measures including increase in excise duty on vehicles, advance income tax rates on import of mobile phones and increase rate of advance income tax on purchase registration or booking of motor vehicles by non-filers. Revenue loss envisaged from the next day of assent given to the Bill 2019 by the President includes: (i) abolition of withholding tax on banking transactions of filers (with revenue impact of Rs 2-3 billion per annum); and (ii) exemption/reduction in customs/regulatory duty on the import of industrial inputs/ smuggling-prone items with an estimated revenue impact of Rs 6-7 billion.
Revenue gain is projected from an increase in the rate of Excise Duty from 20% to 25%, for cars and jeeps up to capacity 3000 cc and to 30% for cars exceeding 3000 cc and levy of 10 percent Excise Duty on locally manufactured/assembled cars above 1800cc expected to generate Rs 2 billion. A senior official of the National Assembly Secretariat stated that the constitution does not bind the government with regard to the time frame for approval of the budget from the National Assembly.
Comments
Comments are closed.