No new tax has been levied in budget for next fiscal year, says Punjab finance minister       Punjab Finance Minister Mujtaba Shuja-ur-Rehman is presenting a budget in the provincial assembly on June 13, 2024. — Screengrab/YouTube/GeoNews

LAHORE: Punjab Minister for Finance Mujtaba Shujaur Rehman Thursday presented the largest-ever annual budget of the province with a total outlay of Rs 5,307 billion for financial year (FY) 2024-25. The surplus budget consisted of an outlay of Rs 4,465 billion, in addition to a development budget of Rs 842 billion, which again is the highest-ever development outlay of the country.

As the federal tax revenues increase, it has become easier for the provinces to make budgets as they received 56 per cent of the total tax revenues from the federal government. This year, as the targeted revenues have increased to Rs12,900 billion, Punjab’s share comes to Rs3,690 billion, almost Rs1,000 billion more than the provisional receipts it received during the fiscal year 2023-24.

In line with the announcement of the federal government, the Punjab government also increased the salary of Grade 1-16 employees by 25pc and that of Grade 17-22 by 20pc. Pension was increased by 15pc for all pensioners. Likewise, the minimum wage has also been enhanced from Rs32,000 to Rs37,000 per month. Unlike the federal budget, Punjab was soft on taxation. In fact, the budget contained some of the public appeasing measures including provision of free solar panels to electricity consumers using less than 100 units per month. For Punjab small housing projects, Rs10 billion has been allocated.

The measures announced for the agriculture sector were also farmer friendly, as half-a-million farmers would be provided interest-free loans of Rs75 billion. They would be also provided interest-free loans to buy tractors under the Green Tractor scheme. Model agriculture malls would be established at a cost of Rs1.25 billion. Livestock cards worth Rs2 billion would be introduced. Rs8 billion has been earmarked for shrimp farming and a model shrimp farm would be established at a cost of Rs5 billion at Lahore. Talks for agriculture income tax between the federal and the Punjab government, as indicated by the federal finance minister, are yet to take place. This is the reason there was much change in agriculture income tax indicated in the budget.

Rs296 billion have been allocated to build 2,380-km long roads, and Rs135 billion would be provided for repair of broken roads through 482 schemes. In education, Rs2.5 billion have been earmarked for undergraduate scholarship programmes. The Chief Minister’s skills development programme to develop the textile industry has been allocated Rs2.97 billion. To earn foreign exchange, the Punjab government has earmarked Rs3 billion.

Foundation for the Nawaz Sharif IT City has already been laid. Free internet is now available at various places. The flagship laptop programme of the PMLN government, which was stopped by the previous PTI government, has been revived. The CM Punjab laptop scheme is being revived and Rs10 billion have been allotted for the purpose. A state-of-the-art school is being established at a cost of Rs670 million. Allocations have also been made for special children, transgender, minorities. Large allocation of Rs56 billion would be utilised for establishing the Nawaz Sharif Institute of Cancer Research in Lahore. Rs8.84 billion have been reserved for establishing an Institute of Cardiology at Sargodha.

The provincial government also proposed amendments to the Urban Immoveable Property Tax law for collection of property tax by introducing the self-assessment model and changing tax calculation from rental-based valuation system to capita value system and bringing all residential/commercial properties of any size having value of above Rs5 million into the tax net.

By doing so, the government will bring almost all the earlier exempted 5-marla and smaller residential properties into the tax net in urban centres of the province, including Lahore, Rawalpindi, and industrial cities Faisalabad, Sialkot, Multan and others as the value of small houses are now exceeding the benchmark of Rs5m. According to the Punjab finance bill, the provincial government, in line with the federal government, has also amended the motor vehicle registration regime from engine capacity to value of the vehicle. By doing so, the government would collect more tax from high value vehicles keeping in view the great variation in prices of various make/model vehicles with same engine capacity.

The government has also introduced imposition of a lifetime token tax on subsequent purchasers for 10 years with 10pc depreciation in tax rate for each financial year after registration to mobilise the revenue as subsequent owner did not pay token tax.

Furthermore, the government raised a different type of court fee from existing 0.50 paisa-Rs20 to new court fees of Rs100-1,000. The Board of Revenue (BoR) has proposed to amend the Court Fees Act, 1870 for enhancement of fees. The BoR further proposed to amend the Stamp Act, 1899 to revising the current rates of stamp duties mentioned in Schedule I of the Act. Through this proposed amendments, different stamp duties from existing Rs1,200 will increase to Rs3,000.

The bill also proposed to amend the Excise Duty on Minerals (Labour Welfare) Act, 1967 (VIII of 1967) on the recommendation of the Mines and Minerals Department. The cess duty imposed for promoting welfare of labour employed in the mining industry ranging from Re1 to Rs5 per ton was fixed during 1979 and after 45 years, the expenditure on welfare projects has increased by 500pc. To expand the coverage of welfare facilities and fill the deficit gap in needs and available monetary resources by the Mines & Minerals Department, the enhancement in the rate of excise duty (Mines Labour Welfare Cess) ranging from Rs30 to Rs50 per ton has been proposed.

The bill has also proposed to amend the Punjab Sales Tax on Services Act 2012 to end the litigation by the Punjab Revenue Authority in respect of the adversely impacting provincial revenues. The solarisation programme worth Rs9bn would connect 7,000 tube-wells with solar energy, according to the budget document. Rs7.5bn has been proposed for renewable energy schemes including Rs2,880 million for 24 ongoing schemes and Rs4,620m for five new schemes in Punjab districts. Rs151.808m proposed for installation of biogas plant in Gujjar Colony, Lahore, with Rs640.040m in the biogas ongoing schemes. Rs214.692m allocated for development of renewable energy.

Initiatives in Sargodha and Gujrat were estimated at Rs350m. Rs32.870m is proposed in the budget for renewable energy building infrastructure across the province. Rs22.870m proposed for establishment of liaison office for Energy Department in Rawalpindi against estimated cost of Rs378.673m. Rs10m were proposed for design and construction of Net Zero energy building in Lahore against estimated cost of Rs7,201.532m.

Rs713m were proposed for renewable energy developments sector investment programme in Gujranwala, Pakpattan, Sheikhupura and Sialkot against estimated cost of the programme Rs12,861 million. Rs40m is proposed for Project Management Unit across Punjab against estimated cost Rs499.523m. Rs125m for installation of AMI meters at public connections across Punjab against estimated cost of Rs394.580 million. Rs50m proposed for allocation for clearance of pending liabilities across Punjab against estimated cost Rs50 million.

The budget also proposed Rs228.837m for solarisation of public sector buildings in Lahore against estimated cost of Rs500 million. Rs84m proposed for solarisation of residences in GOR-I, Lahore against estimated cost of Rs601.800m. Rs270m for energy efficiency and conservation programme across Punjab against estimated cost of Rs3,615.016 million. Rs32.604m allocated for solarisation of basic health units, across Punjab against estimated cost of Rs449.400m. Rs15.440m proposed for solarisation of basic health units across Punjab against the estimated cost Rs647.467m. Rs259.100m proposed for solarisation of 100 higher secondary schools in Punjab against estimated cost of Rs350 million. Rs301.115m proposed for solarisation of 35 tehsil headquarters hospitals and 100 rural healthcare centres and installation of BESS in Punjab against estimated cost of Rs385m. Rs86.018m proposed for solarisation of schools for differently-abled children against estimated cost of Rs250m. Rs40m proposed in the budget for Punjab Ujala Programme (Central Punjab) in 25 districts against estimated cost of Rs1,788.020m. Rs4,000m proposed for Chief Minister’s Roshan Gharana Programme across Punjab against estimated cost of Rs9,500 million.

Meanwhile, the Punjab Assembly witnessed rejection of the proposed budget by the opposition. The session, marked by chaos and confrontation, underscored the deep divisions within the house. During the finance minister’s speech, the opposition responded with loud slogans and protests, quickly escalating to the point of surrounding the speaker’s podium. The uproar continued unabated, with opposition members moving towards the chief minister’s seat, prompting ministers and government members to form a protective barrier.

The situation intensified as Provincial Minister Sohaib Bharat and MPA Ghazali Saleem Butt intervened to prevent the opposition from reaching the government benches. At one point, two ministers and opposition members engaged in physical confrontation, further highlighting the fraught atmosphere. In the presence of Maryam Nawaz, the budget documents were torn apart.

The opposition accused the government of presenting a fraudulent budget, criticising both the federal and provincial governments for failing to provide relief and instead burdening the salaried class with additional taxes. The session was abruptly adjourned by Speaker Malik Ahmed Khan amidst the ongoing commotion, with the next meeting scheduled for 11am on Thursday, June 20.

Later on, Punjab Information Minister Azma Bokhari, while talking to the media, said a tax-free budget has been presented and funds have been allocated for 77 schemes of the chief minister Punjab. She said a health programme worth Rs1 bn has been started for journalists.

About the Defamation Bill, she said genuine journalists would not be affected by the bill. Those who earn in dollars and commit defamation would be affected by it, she added. She said now the matter was sub judice “and we should wait for the court verdict”.