Miftah Ismail says Pakistan going through 'difficult phase'

MIftah Ismail says they had no other option but to take tough decisions to stabilise the economy

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Finance Minister Miftah Ismail addresses the post-budget press conference in Islamabad. -Geo News screengrab
Finance Minister Miftah Ismail addresses the post-budget press conference in Islamabad. -Geo News screengrab

  • MIftah Ismail addresses post-budget press conference in Islamabad.
  • Defends measures announced in Budget 2022-23.
  • Says they had no other option but to take "tough" decisions. 

ISLAMABAD: Finance Minister Miftah Ismail said the Budget 2022-23 preparation was the "most difficult" thing to do as the country was going through a very critical phase and the government is targeting "fiscal consolidation" and "provision of relief" to the masses in the next fiscal year.

Addressing the post-budget press conference in Islamabad today along with Information Minister Marriyum Aurangzeb, State Minister for Finance Aisha Ghaus Pasha, Miftah Ismail thanked his team for the great work they have done in helping them in formulating the Budget 2022-23.

He maintained they presented the budget when the country was going through a difficult time. He criticized the former government for not taking steps to resolve the issues.

Post-budget analysis: Any respite for the poor?

The finance minister said they had no other option but to take tough decisions and added, "the target of next year's budget is fiscal consolidation and provision of relief to the masses."

During the current fiscal year, the finance minister said the government gave over Rs1100 billion subsidy to the power sector. He maintained that they have to pay Rs500bn for the losses incurred by the power companies.

“It means the government of Pakistan is giving Rs16 per unit subsidy,” he added.

“We are generating Rs30-35 per unit of electricity,” he said and claimed that they have the most efficient power generation plants in the world.

Bad administration, flaws rate fixation system, transmission and distribution losses and other issues were major reasons behind the high power generation rate, he added.

Rs400bn subsidy given to gas sector

The finance minister said that Rs400bn subsidy was given to the gas sector. He maintained that they would not let any factory be closed as they provide jobs to the people.

The government is facing losses in the gas sector, he said, adding that it is not known whether the gas is being stolen or it is evaporating.

‘No option left other than tough decisions’

The finance minister said that Pakistan is a nuclear power and they have to put the country’s economy on the right track. 

"In violation of the agreements signed with the IMF, the previous government gave subsidies on fuel. PM Shahbaz Sharif took difficult decisions for the sake of the country. Now, the country has left no option other than tough decisions."

Miftah Ismail said we have imposed additional taxes on the well-off people while efforts have been made to reduce the tax on personal income tax. He said Pakistan is a dignified nuclear power state and we will have to correct the course of our economy.

Highlighting another “significant” development announced in the Finance Bill 2023, Miftah Ismail said they have introduced a new dispute resolution mechanism to solve cases involving the Federal Board of Revenue (FBR).

“Earlier, the FBR officials were empowered to decide who would head the Alternative Dispute Resolution Committees (ADRCs) but It has been changed now.”

Under the new mechanism, the FBR would select one referee and the complainant would select one and both of these nominees will choose the third individual who would act as an umpire.

“The decision will be based on the majority,” he said, adding that it would help address the concerns raised by the business community. 

Alluding to the soaring prices of palm oil in the international market, the Miftah Ismail said the package of 20 billion rupees has been given to promote the cultivation of oil seeds. The finance minister, however, admitted that it does not seem that the prices of the commodity will come down this year.

2.5m shopkeepers to be brought into tax net this year

The finance minister said that they would bring 2.5 million shopkeepers into the tax net this year.

He maintained that the country will have a budget deficit of Rs4,598 billion during the next fiscal year. He said the debt servicing has been estimated at Rs3,950 billion.

‘Imran Khan and his team were incompetent, corrupt’

The finance minister said that it was not their priority to lodge cases against the former rulers.

“Imran Khan and his team were incompetent and were involved in corruption,” he said, adding that they borrowed more than all previous governments.

He maintained that their first priority was preventing the country from becoming Sri Lanka.

As part of the government efforts to mitigate the impact of fuel price hike, the deserving people will start receiving Rs2,000 from June, he said.

In addition to this, the finance minister said that Punjab Chief Minister Hamza Shahbaz has launched the “Sasta Ataa Scheme” to provide relief to the poor. He maintained that the Sindh and KP governments will also provide wheat flour to the masses at cheaper rates.

In her remarks, Aisha Ghaus Pasha said that the government's aim is to ensure economic stability and take the country towards growth. 

She said the philosophy of the budget in these difficult times was to put the minimum burden on the common man. He said we are providing relief to the common man and this includes the cash amount of Rs2,000 to the deserving families.

Aisha Ghaus Pasha said that the subsidy has been given to the farmers to enhance agro productivity and cut the import bill of food items. 

She said reducing the budget deficit and non-imposition of indirect taxes are anti-inflationary measures which were taken to protect the poor.