Govt to Collect Over Rs1trillion Non-tax Revenue in the Coming Year
- Various reforms by the government are bearing fruit and the economy is moving towards stability.
- Privatization of the National Bank and State Life Insurance is under consideration.
- Eight entities would be privatized in the next one-and-a-half-year as well as two LNG power plants would be sold in the first phase.
Adviser to the Prime Minister on Finance Dr. Hafeez Shaikh said that the government is eyeing a collection of over Rs1 trillion in non-tax revenue.
While addressing a press conference in the federal capital, Adviser to the Prime Minister said that the government is expecting to collect Rs200 billion from the renewal fee of cellular licenses of telecom companies and Rs300billion through the privatization of Re-Gasified Liquefied Natural Gas (RLNG) plants.
“In the coming year, we are expecting great leaps and bounds when it comes to non-tax revenue: the government’s earnings through means other than collecting taxes.”
“If the exchange rate remains stable, the State Bank of Pakistan (SBP) would earn Rs400billion.”
The Adviser further said that all of these combined with revenues from privatization of state-owned enterprises and other initiatives would bring in over Rs1 trillion in the coming year. The increase in revenue would enable the government to pay off its loans and work for the welfare of the people.
“The privatization of National Bank of Pakistan (NBP) and State Life Insurance Corporation (SLIC) is currently under consideration,” he added.
While talking about taxation, the financial adviser said that the government had set the tax collection target at Rs5,500 billion. Out of this, Rs580 billion have already been collected while the number of tax filers has gone up by 0.6 million to 2.5 million.
He said that the circular debt was reduced by Rs100 billion and power theft was curtailed and the government also froze the defense budget.
“The rupee is now stable and the stock market is also seeing growth,” he said.
Pakistan’s economic indicators portrayed a worrisome picture when the Pakistan Tehreek-e-Insaf (PTI) assumed office.
Pakistan was on the brink of bankruptcy because of the previous government’s policies. But through the incumbent government’s financial reforms, the economic situation of the country has improved and is moving towards stability, the current account deficit had been reduced by 73%.
The Adviser told that the government is working for the betterment of the people of Pakistan and no compromise would be made on taxation.
“Government took tough financial decisions for the welfare of the people and is currently taking measures to promote investment,” he added.
The government’s decision to privatize state-owned enterprises was welcomed by the Islamabad Chamber of Commerce & Industry (ICCI).
President of ICCI, Ahmed Hassan Moughal said that loss-making state-owned enterprises had become a big burden on the national exchequer.
He said that handing them over to the private hands is the optimum solution to save the taxpayers money from unnecessary wastage.
Earlier, the Minister for Privatization Muhammad Mian Soomro had said that the government would sell its share in the SLIC.
While briefing investors, he had said that the profit and market share of the SLIC was shrinking; hence the incumbent government had decided to sell its stake in the loss-making organization.
The Minister said:
“SLIC is an important institute and its profit and market share are declining which is a cause for concern. Providing the State Life’s private sector shares will improve its performance.”
With the help of privatization, the national institutes running in losses will be provided better investment opportunities.
With the introduction of advanced technology and the corporate sector’s better abilities, poverty can be alleviated and tax revenue increased.
The government is focusing on the revival of Pakistan Steel Mills and there are 204 state-owned enterprises and the government could not privatize them all.
Prime Minister Imran Khan had constituted a team of experts for the revival of loss-making public enterprises.
In February this year, it was informed by Senate’s Standing Committee on Privatization that the government had decided to privatize 49 entities over the period of next five years.
The Federal Privatization Secretary Rizwan Malik had told the meeting that the government had tasked the Ministry of Privatization to execute the plan.
He had also said that eight entities would be privatized in the next one-and-a-half-year, while two LNG power plants would also be sold in the first phase.