- The total outlay of the budget is around Rs2240 billion.
- "This tax relief package is the largest tax relief package in the history of Punjab," said the minister.
Punjab Finance Minister Makhdoom Hashim Javan Bakht is presenting the budget 2020-21in the Punjab Assembly on Monday.
The total outlay of the budget 2020-21 is around Rs2240 billion.
"The provincial tax collection recorded an increase of 13 percent, whereas, Rs144bn were distributed among the needy under the Ehsaas Program," said Bakht.
He said that collections' revenue worth Rs4,963bn from Federal Divisional Pool is expected while Punjab will be provided Rs1,433bn under NFC Award during the next fiscal year. He said that a target of Rs317bn has been fixed for Own-Resources Revenue.
The minister said that special funds on a priority basis have been allocated for eleven important sectors including education, health, and employment generation.
The provincial government has proposed to allocate Rs8.73 billion for the forest department. Furthermore, Rs13.30 billion has been allocated for the livestock sector, meanwhile, Rs31.73bn has been allocated for the agriculture sector.
After the Coronavirus pandemic, the Punjab government further strengthened its business-friendly policies and announced a tax relief package of over Rs56 billion in the next financial year.
"This tax relief package is the largest tax relief package in the history of Punjab," said the minister.
The tax rate on more than 20 services is proposed to be decreased from 16 percent to 5pc including small hotels and guest houses, wedding halls, lawns, venues, tent services, and caterers, IT services, tour operators, gyms, property dealers, rent a car service.
"On the one hand, the business community will benefit from the budget relief package, on the other hand, the people will also get relief," said Bakht.
In the budget 2020-21, it is proposed to reduce the sales tax on services including health insurance and doctor's consultancy fees and hospital fees, which were 16pc and 5pc, respectively, to zero percent.
The government has proposed to levy 16pc tax on restaurants and beauty parlors customers on cash payments and 5pc tax on credit or debit card payments which will help document the economy.
he said that Rs2bn has been allocated for religious tourism and setting up new tourist centers, whereas, the salary budget has been frozen at Rs337.60bn.
The entertainment duty rate is proposed to be reduced from 20pc to 5pc. All cinemas are proposed to be exempted from entertainment duty till June 30, 2021.
Taxation on real estate
The minister added that property tax for the next financial year can be paid in two installments. In case of full tax payment by September 30, 2020, taxpayers will be given a 10pc discount instead of 5pc and a surcharge for the financial year 2020-21. There will also be a full rebate on receipt, he said.
The minister informed that the application of the new property tax valuation table has also been postponed for one year. He informed that In case of full payment of vehicle registration and token tax, a 20pc discount will be given instead of 10pc.
Hashmi said that the revenue collection from the Board of Government Land Lease, Tenancy, Sale, etc. (Land Utilization Policy) is expected to reach Rs20bn.
He added that a special discount of 5pc will be given in case of online payment under the ePay portal.
The minister informed that the government has proposed to slash the current rate of stamp duty from 5pc to 1pc in the next financial year. The construction industry will flourish and new jobs will be created, he said.
The minister told the assembly that in line with the vision of the Prime Minister of Pakistan, another historic step has been taken to facilitate business by reducing the business license fee to zero percent from local government revenues.
The Punjab government's move will provide tax relief of about Rs600 million annually to the local population, he said.
"Despite all the economic challenges and lack of resources in the wake of the Coronavirus, we have tried not to compromise on our development program so that the journey of economic development in the province can resume," he said.
A total of Rs337 billion is being allocated for the development budget for the next financial year. Rs97.66 billion has been earmarked for the social sector in the annual development program, whereas, Rs77.86 billion has been earmarked for infrastructure development.
Rs17.35 billion has been earmarked for the production sector and Rs. 45.38 billion for the services sector, whereas, Rs51.24 billion has been allocated for other sectors.
Rs47.50 billion has been earmarked for special programs, informed the minister whereas, Rs25 billion has been earmarked for the Public-Private Partnership (PPP).
The sales tax for PPP has been cut to zero percent for five years in order to attract maximum investment and the province can complete major development projects even with limited resources, informed the minister.
the minister informed that 35pc share of Annual Development Program 2020-21 has been allocated for South Punjab. Rs8 billion has been allocated for micro, small and medium enterprises to play a strong role in providing employment to the weaker sections of Punjab, said, Hashmi.
The minister said that Rs15bn is being allocated for the Community Development Program. He said that an allocation worth 6.87 Billion rupees has been made for Technical and Vocational Education Authority out of which Hundermand Jawan Program is being launched at a cost of 1.50 Billion rupees.
Projects under PPP
Under the Public-Private Partnership Authority, megaprojects worth Rs165 billion have been identified for the next financial year including Lahore Ring Road SL-4, Multan Vehari road diversion plan, construction of Nala Lai Expressway, the supply of water meters, and construction of Rawalpindi Ring Road.
Bakht said that more than Rs391bn is being allocated for the education sector. For the financial year 2020-21, Rs350.1 billion has been allocated for the School Education Department. "This amount will be used to provide scholarships to more than 500,000 students and free textbooks to all students," said the minister. Whereas, Rs13.50 billion has been earmarked for school councils.
Rs11.86 billion has been allocated for 1,348 clean water and sanitation schemes.
Punjab Finance Minister said that an amount of Rs284.2bn has been allocated for the health sector for the next fiscal year. He said that the government is utilizing all available resources to tackle the Covid-19 pandemic and an overall amount of Rs13bn has been fixed to control this pandemic.
He said that Health Insaf Card Program has been expanded to the entire province and health cards have been so far distributed amongst five million families.
Opposition protest during speech
The opposition members chanted anti-government slogans around Speaker Dice on Monday, as the finance minister presents budget 2020-21. Opposition shout slogans and tore budget copies were torn during the finance minister's speech.