Karachi: (Geo News): Geo News presented a Rs. 3,000 billion budget Geo Awami Budget for the fiscal year 2010-11. This budget was prepared by the youth of Pakistan along with economists of the country. Members of the Geo Awami Budget committee were the economist Qazi Masood, A.B. Shahid, Ali Raheem and Muzammil Aslam. Geo Awami Budget was presented by Rizwan Azan in the presence of committee members and the program was moderated by Talib Haider.
 The details of Geo Awami Budget are as under:Almighty Allah has blessed Pakistan with countless natural resources and hard working people, resources and hard working people, but unfortunately until now no concrete plans have been devised to properly utilize the available resources. If we had developed these resources properly, we would not only have been self-sufficient in energy; the people of Pakistan would not have had to continue bearing the burden of load-shedding and Pakistan’s economy would have prospered such that our agricultural and industrial production would have carried Pakistan out of the pool of developing countries into the league of developed countries. In the opinion of experts who took part in the budget making process, by developing these resources we can easily achieve the annual growth target of 7 to 8 percent.

It was also imperative to mention that by achieving growth targets we will be able to provide more educational and vocational institutes for the masses and expand infrastructure especially road and telecommunication networks, motorways, highways and ports along with the provision of electricity and water.
Achieving this target will not only create more employment opportunities specifically for the youth and labourers but will also create more opportunities and resources for the betterment of families currently living below the poverty line. This growth will also increase facilities available to agriculturists and industrialists as well as other sectors of the economy.
During the last two years, the prices of food items have witnessed significant increase. The rising costs and the non-availability of food items is a cause of concern for every household. Artificial shortage and hoarding of food items have increased inflation, which has put additional burden on the common man.
Keeping in mind these problems of the poor people, it has been decided to provide an allowance of Rs 1000 per person. This would help around 7 million poor people across the country. NADRA will not only provide statistical support for this project and lists of deserving recipients from all districts and unions but also help keep the entire disbursement process transparent. It was suggested that initially Rs. 120 billion should be provisioned for this purpose and this amount should be increased as resources are increased. This financial assistance will be provided to families on the condition that at least one of their children is sent to school, so that people are encouraged to educate their children. Moreover, it has been proposed that additional amount would be provided to families sending their child to school, which would ultimately promote education in the country.

Next year, Rs 3,000 billion would be earmarked at the federal level, out of which Rs 600 billion will be spent on development projects. At the federal level Rs 250 billion would be allocated for dealing with the government affairs and Rs 350 billion would be allocated to provinces.

The provinces will also get Rs. 950 billion under the National Finance Commission.
The Federal Board of Revenue should set a revenue collection target of Rs. 1600 billion for the next financial year.
The government intends to introduce new taxation system from the next year, but the government should take all the stake holders into confidence before implementing new taxation system.

Proper implementation of the existing tax regime will help end tax evasion, corruption and there would be no need to introduce new system.
For the next financial year, the annual development expenditures have been estimated at 4.5 percent. Unfortunately, this year too, heavy government spending continued and in this regard the government sought financial assistance and loans from international donors. Due to this at present every Pakistani is facing a debt of Rs. 27000.

The industrial growth during the period under review remained slow due to the war on terror, delay in payments for the war on terror and decline in foreign investment kept the economy on slow path.

Energy crisis also creates problems for the industries to operate properly. Due to all these hurdles, it is expected that the budget deficit will exceed Rs. 700 billion, which is around 5 percent of the gross domestic product.

To provide subsidy to the people, the government earmark Rs. 170 billion, out of which Rs. 50 billion should be allocated as subsidy on food items. This will also include Rs. 120 billion being disbursed among the needy people.

Pakistan’s agriculture and energy sectors have immense growth potential. Through hydel power project in Sindh the country can generate 50,000 megawatts. Other than hydel power the country can fulfill local energy demand through Thar coal reserves and other natural resources. By properly utilizing these resources, the government cannot only generate cheaper power but can also export it to regional countries such as India and China.

At present, the cost of thermal power stands at Rs. 12 per unit, whereas hydel power cost stands at Rs. 3 per unit. For this government could also seek assistance from the donor agencies.

Likewise, if authorities take measures for water shortages, the country could double agriculture production in a short span of time, which will ultimately improve the economic condition of the country.

The country is in dire need of land reforms. Poor people can get 3 to 5 marla land near cities limit for housing purposes and 7 to 7.5 acres of land for agriculture purposes. It is time that the poor should be awarded ownership rights of land and the government should impose a restriction that bars any person from keeping more than 100 acres of land.

It has been suggested that initially Rs. 10 billion each should be allocated for two big dams and the government should also focus on construction of several small dams too.

Rs. 30 billion should be allocated to provide clean drinking water, hygiene and health, electricity and roads that connect farms to markets. New cities should also be built in the country with special focus on industrial and economical parks. Wholesale and retail markets should be constructed. In addition, IT centres and institutes of vocational training should be built in every district and tehsil so that the new generation can avail maximum chances for employment.

It is suggested that during the next financial year Rs 600 billion should be provided for developmental projects, out of which Rs 40 billion should be allocated for reconstruction of those areas, which faced natural disasters.

Out of the total Rs. 600 billion development budget, the federal share stand at Rs. 250 billion and the provinces should get Rs. 350 billion.

A new scheme by the name of Universal Education Fund will be initiated for which Rs. 75 billion has been proposed and Rs. 50 billion has been proposed under a health fund through which hospitals would be established in around 30 districts of the country during the current year. This will help the country setting up hospitals at every district level during the next five years.

It has been advised that Rs. 50 billion should be earmarked in the new budget to enhance the scope of microfinance banking in the country.

There was a recommendation to increase the salaries of government employees by 30 to 40 percent so that they can balance their expenses against the rising cost of living. This increment should also be given to pensioners as well. In this respect, 50 percent of salary raises should be performance-based.

Keeping in view the rising inflation it has been suggested in the Geo Awami Budget that the minimum salary should be Rs. 10,000.

We must deregulate the prices of agri-products to increase the national agricultural output, so that our farmers may on one hand receive international prices for their products and on the other, the smuggling of these products can be discouraged. Steps should be taken in consultation with farmers to eliminate middlemen and ensure that farmers receive the best prices for their product, so that they can supply directly to the markets. While increasing the support price authorities should keep in mind the common man who is not related to the agriculture industry and out of proportion raise can affect them adversely. Agricultural research should also be promoted at the federal and provincial levels so that higher yield varieties of seeds may be provided to cultivators.

Research programs need special attention to promote agriculture in the country. For this, measures will be needed at the federal and provincial levels so that the quality of the produce can be improved by using latest technology. Additionally the government in collaboration with the private sector should set industries to promote agriculture.

Defence plays a key role in any country. Every year Pakistan earmarks huge portion of the budget for defence. Pakistan is a peace loving country and wants peace in the region. On the other hand to stabilize the economy and to allocate significant amount in the heads of poverty reduction, health, education, clean drinking water and to create more and more employment opportunities in the country. It is also proposed not to make any changes in the current defence budget and Pakistan’s allies should bear the expenses of the ongoing war against terror; else it will oppress Pakistan’s economy and the public.

To achieve this goal, it is suggested that the salaries and other benefits of the president, prime minister and all other ministers and senators should be slashed half.

It is also proposed that a two-year ban should be imposed on purchase of new cars, new aircrafts, new furniture etc., for the President, Prime Minster, Ministers, Secretaries and other officials.

There is a possibility that the budget of security agencies be reduced by Rs. 10-15 billion. In this regard, the provinces, can decide about any raise in this head through their own means and resources. These institutions should provide security to the public instead of the civil servants and ministers.

The interest rate on loans is a key challenge for the country as it will take around Rs. 800 billion in the budget to pay them off. To get rid of this menace, the country should increase the pace of economic activities in the country.

Moving on to the revenue side, in the next fiscal year, Federal Bureau of Revenue has set its collection target to Rs. 1600 billion. Of this, Rs. 640 billion should be raised through direct taxes whereas Rs. 960 billion should be raised through indirect taxes including sales tax. It has also been suggested that the taxation system should be equitable and transparent in such a way that every sector should contribute some taxes. By including agriculture and services sectors, lawyers, doctors, engineers, shop owners, middlemen, etc., in the tax net; the tax burden on existing 2 million tax payers can be reduced. Salaried workers should receive special rebates on taxes. To meet the revise tax collection target it recommended that FBR should take assistance from NADRA to gather the income information of different business sector, companies and individuals. For this purpose NADRA should be made an independent authority.

We advised that income tax exemption for individuals earning annually up to Rs. 200,000 should be revised upwards to Rs. 400,000 thus reducing the tax burden on salaried persons.

It is also recommended that the tax rate on a single member company or small and medium enterprise be slashed from the existing 20 percent to 15 percent.

Five percent withholding tax should be imposed on purchase of new cars; and at the time of their registration more withholding tax could be charged.

Car manufacturers increase the prices of their brands at will, which results in creating problems for the people. It is recommended that import ban on used, reconditioned and 800cc new cars be lifted to break the monopoly as well as discourage the local industry from minting undue profits.

It is suggested to impose withholding tax on the purchase and registration of over 2000cc cars.
Likewise, the rate of withholding tax on imports of luxury items be raised from the existing six percent to 10 percent.

There should be a ban on the export of raw materials being consumed by domestic companies.
These raw materials include food items too.

It is also recommended to impose 5 percent withholding tax on sale and purchase of immovable property. Plots under 5 marla will not come under the ambit of this tax. Sales tax to be raised by 2 percent on non-food items.

Retailers and wholesalers with over Rs. 10 million turnover should be taxed at the rate of 0.5 percent.
To bring transparency in utility stores affairs, it is proposed that ration card system should be reintroduced.
Mass transit program should also be introduced in big cities with the self-generation of resources at both federal and provincial levels.
There is a need to devise strategy to give protection to small investors of the stock exchange. Capital gains tax be imposed.
These suggestions have been tabled by the panel of economic experts and the youth. All factors have been taken in consideration to accommodate proposals of every sector in the upcoming budgetary recommendations. The measures taken would increase the resources and production so that we can rely more on our own resources rather than begging before donor agencies.

Khuda Hafiz!
Pakistan Paindabad