No new taxes in Rs14.5tr federal budget

ISLAMABAD: Finance Minister Ishaq Dar presented the budget for fiscal year 2023-24 (FY24) on the floor of the National Assembly. During the speech, the minister said that the government was imposing no new taxes for the upcoming year.

Dar said for the next year, GDP growth had been budgeted at 3.5 per cent, terming it a “modest target”. He said that this budget is “not an election budget” and is focusing on the “elements of the real economy”. 

Dar said agriculture is the backbone of the economy and this budget is placing special attention on this sector. He then went on to list some of the special measures taken for the agri sector, primary among which was increasing agri loans from Rs1.8 trillion to Rs2.25 trillion.

Key proposals in Budget 2023-24

• No increase in duties on import of essential items
• No new taxes for the upcoming year
• Exemption of customs duties on import of seeds for sowing to promote growth in the agricultural sector
• Withdrawal of capping of the fixed duties and taxes on the import of old and used vehicles of Asian Makes above 1300CC
• Services provided by restaurants including cafes, food (including ice cream), parlours, coffee houses, coffee shops, deras, food huts, eateries, resorts and similar cooked, prepared or ready-to-eat food service outlets etc are proposed to be taxed at 5pc if payment is made through debit or credit cards, mobile wallets or QR scanning
• Grant of exemption of sales tax on contraceptives and accessories
• Minimum wage proposed at Rs32,000; wages of government employees from Grades 1-16 and Grades 17-22 to be increased by 35pc and 30pc, respectively
• Increase in withholding tax rate from 1pc to 5pc on payment to non-residents through debit/credit or prepaid cards
• Exemption of customs duties on import of shrimps/prawns/juvenile for breeding in commercial fish farms and hatcheries
• Rs1 billion allocated for health insurance of working journalists.–Dawn