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ISLAMABAD: Federal Minister for Finance Senator Muhammad Aurangzeb on Tuesday reiterated the government’s commitment to reduce expenditures to strengthen the country’s economy.

Addressing a press conference in his hometown Kamalia on Tuesday, the Minister for Finance said the federal government would shut down parallel ministries or departments that had been devolved to provinces.

Aurangzeb said the government was trying to expand the tax base in the country as “countries are run only on taxes.”

Post-budget presser: govt wants to enhance tax-to-GDP ratio to 13% in 3 years, says Aurangzeb

“We are moving towards enforcement and compliance as laws are there but we somehow cannot enforce them,” the Minister for Finance said.

The finance minister said GDP was depended on taxes and the authorities must have to enforce them. “We are going to introduce tax on retailers from July after registration of about 32,000 of them,” he added.

He said the national economy was moving on the right path and they were trying to bring more sectors to the tax net.

Responding to a question, the minister said the government was being assailed for not giving relief to the salaried class. “How can we give them relief when the institutions are making billions of rupees losses,” he added.

Aurangzeb made it crystal clear that everything would be handed over to the private sector if Pakistani really wanted to make progress. “You can run schools, universities and hospitals on charity money but not a country. Tax concessions will gradually be abolished,” he maintained.

Aurangzeb reiterated government’s commitment to reduce expenditures and boost revenues as part of a comprehensive effort to strengthen the country’s economy on sustainable grounds.

The minister said the federal government would shut down parallel ministries or departments that had been devolved to provinces. “This move is expected to significantly reduce expenditure and improve efficiency, adding, the Prime Minister has already announced the closure of Pakistan Public Works Department, a move that will help reduce the financial burden on the government,” he added.

He said, “Secondly, the government will privatise State-Owned Enterprises (SOEs), which have been a significant drain on the national exchequer.” He cited the example of Pakistan International Airlines (PIA), which had a liability of 622 billion that had been transferred to the government. “The privatisation of SOEs will help reduce the financial burden on the government and improve efficiency.”

The minister also announced that airport outsourcing was being completed, with Karachi Airport set to be handed over to the private sector by July or August this year, to be followed by Lahore Airport.

He said the government was committed to reducing losses and burdens on the federal government, and those measures were part of a larger effort to achieve that goal. He emphasised that the Prime Minister was personally leading the effort to reduce expenditures and improve efficiency.

On revenue side, Aurangzeb highlighted the need to increase the tax-to-GDP ratio from 9.5 percent to 13 percent over the next three years, stressing that taxes were essential for running the country. To achieve this goal, the government has announced revenue measures, including bringing the non-taxable sector into the tax base, gradually eliminating tax exemptions worth Rs3.9 trillion, and rephrasing policies in areas like health and agriculture.

He announced that 32,000 retailers had already been registered and would be taxed starting from July 2024, and emphasised the government’s commitment to bringing other sectors into the tax net.

“The government is also focusing on compliance, plugging leakages in the system, and implementing an end-to-end digitization system to reduce human intervention, increase transparency, and end corruption. Sales tax automation is a top priority,” he remarked.

He reiterated government’s commitment to develop the agricultural sector, saying Rs.41 billion had been earmarked the federal Public Sector Development Programme (PSDP) to promote that sector, adding the government also intended to solarise tube wells, provide loans to small farmers, and develop warehouses to facilitate small farmers. He said, subsidies on fertilizer, seeds and agriculture would continue. He said banks, including Islamic banks, were being pursued to facilitate loans for farmers to help promote that sector.

The Minister for Finance made it clear that the International Monetary Fund (IMF) had nothing to do with the country’s agriculture sector.

In the IT sector, the government aims at facilitating freelancers and increasing exports from $3.5 billion to $7 billion. He said a hefty amount had been earmarked in the budget to facilitate IT sector.

The minister assured that the Prime Minister’s recent visit to China was focused on technology transfer, industry development, and enhancing exports, rather than seeking aid.

Overall, the government’s plans aim at strengthening the country’s economy, reducing dependence on aid, and promoting sustainable growth through taxes, compliance, and development in key sectors like agriculture and IT.

Comments

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Aamir Jun 20, 2024 09:20am
Stop the talk and first show how much wastage and expenditure you have reduced. Give us facilities like the developed countries. Then talk about tax collection
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Paksarzamin Jun 20, 2024 09:24am
Aurangzeb doesn't know what unnecessary expenses are caused by unnecessary MNAs, judges and others?
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KU Jun 20, 2024 10:05am
We hope that FM carries out plans to shut down useless public depts n SOEs eating up tax payers money. But looks like the nefarious will not allow him to hang around much longer. Helpless Pakistan!
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Shahbaz Ali Jun 20, 2024 10:30am
Steps in right direction. But he should walk the talk. Public loss making SOE have always been powerful in past to avoid privatization. Let's see this time...
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Dawood Mustafa Jun 20, 2024 10:51am
Sell each and every SOE. Abolish useless ministries and departments. Tax each and every salaried govt / private Pakistani equally. Do justice, then Pakistan will prosper.
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Arshad Jun 20, 2024 12:48pm
Business will be as USUAL for the ELITE Class of this Country. Life for an ordinary You & Me will become more miserable in coming days.
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Maqbool Jun 20, 2024 04:10pm
I hope, but doubt, that he’ll even get a complete list of SOE . Hidden as usual for jobs for the boys
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