Friday, June 09, 2023

To increase remittance via formal channels, govt proposes incentives for overseas Pakistanis

A foreign currency dealer hold $100 bills. — AFP/File
A foreign currency dealer hold $100 bills. — AFP/File

In a bid to increase remittances via formal channels, Finance Minister Ishaq Dar has announced that the government is proposing the abolishment of a 2% final tax on the purchase of immovable property for overseas Pakistanis.

“Remittances are a crucial part of foreign exchange reserves, representing 90% of the country's exports,” the financial czar said during his budget speech at the National Assembly on Friday.

Apart from abolishing the final tax on immovable property to promote remittances through formal channels, the government has also proposed the introduction of a "diamond card" for people sending over $50,000.

Those who will avail the "diamond card" can get one non-prohibited bore license, a gratis passport, preferential access to Pakistani embassies and consulates, fast-track immigration at Pakistani airports, and special prizes through draws.

The proposal was announced by Dar as he unboxed a Rs14.46 trillion budget for the fiscal year 2023-24, introducing "no new taxes" and envisaging an economic growth of 3.5% as the crisis-riven country looks to persuade the International Monetary Fund (IMF) to release more bailout money.

Pakistan has shared the budget numbers with the IMF, and the finance minister believes there's no further objection the lender could raise — as they are in line with the programme requirements.

Dar — who presented the second budget of the Pakistan Democratic Movement-led government, which came into power in April last year, in the National Assembly and Senate — returned to the podium to announce the federal budget after a hiatus of five years.