ISLAMABAD: The government plans to generate $2 billion through the launching of Euro Bonds in the upcoming budget for 2023-24. The budget makers are finding numbers crunching hard for the upcoming budget on account of dollar inflows through foreign loans at a time when the IMF programme has not been revived. However, the government plans to generate over $22 billion through foreign loans in the upcoming budget, and numbers crunching is still underway with expectations that Islamabad will be able to generate $2 billion through the launching of Euro Bonds in the next fiscal. The government had planned to launch international bonds in the outgoing fiscal year as well but failed to do so mainly because of the non-revival of the IMF programme, poor credit rating and increased bond rates and risks.
The government has also proposed an income levy on all kinds of assets and increasing withholding taxes on cash withdrawals and registration of motor vehicles in the upcoming budget for 2023-24. The government also plans to increase salaries and pensions of government employees from grade 1 to 16 and also for employees from 17 to 22 in the range of 30 percent and 20 percent respectively. The pension bill would be more than the salary bill of the federal government. The total budget outlay has been envisaged over Rs14.2 trillion for the upcoming budget whereby the FBR’s tax collection is fixed at Rs9.2 to Rs9.5 trillion and the non-tax revenue target at Rs2.5 trillion. In order to achieve a primary balance of 0.1 percent of GDP, the provinces are expected to generate one percent revenue surplus in order to achieve the primary balance into a slightly positive range in the next budget. The debt servicing is going to consume a major chunk of Rs7.5 trillion in the next budget.