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Jul 03 - 09, 2000

Punjab unveils Rs212 billion budget

Finance Minister Shahid Hafeez Kardar on Wednesday announced the Punjab budget for 2000-2001 with a total outlay of Rs212.37 billion, reducing the number of taxes from the present 36 to nine.

The budget projects an unusual increase of 17.8 per cent in the non-development expenditure over what this sector consumed in the outgoing year.

The minister announced withdrawal of various provincial taxes on hotels, restaurants, marriage halls, mobile phones and courier service; on advertisement on radio, TV, newspapers and journals after introducing a 15pc GST on them.

According to the Punjab Sales Tax Ordinance 2000, promulgated by Governor Mohammad Safdar earlier in the day, the GST would be charged on the above mentioned services from July 1.

The ordinance empowered the government to bring about certain changes in the agriculture income tax. According to the new strategy, no direct tax would be levied on the pieces of land measuring up to five acres. The land exceeding five acres would be taxed at the rate of Rs50 per acre; from 12.5 acres to 25 acres Rs100 per acre; from 25 acres to 50 acres Rs300 per acre, and for 50 acres and up the rate would be Rs350 per acre.

The tax for orchards (irrigated) will be Rs500 per acre and for barani Rs250 per acre. The rate of tax on total agricultural income where the income does not exceed Rs100,000 will be 5 per cent of the total income; from Rs100,000 to Rs200,000 income Rs5,000 plus 7.5pc of the amount exceeding Rs100,000.

For the income exceeding Rs200,000 up to Rs300,000, the levy would be Rs12,500 plus 10pc of the amount exceeding Rs200,000. On the income exceeding Rs300,000 the tax amount would be Rs22,500 plus 15pc of the amount exceeding Rs300,000.

All this taxation is likely to cause an additional resource mobilization of Rs15 billion, but the province seems to have compromised on Rs6.86 billion which it could have got in straight transfers from Islamabad under the National Finance Commission formula.

Rs41.73 billion budget for NWFP

Finance Minister Farid Rehman on Monday announced a Rs41.73 billion surplus, tax-free budget for the fiscal 2000-2001. The budget projects a surplus Rs2.6 billion which will be neutralized by less receipts to the extent of Rs6.89 billion on account of net hydel profits capped already by Wapda at Rs6 billion.

The hydel profit receipts have been projected at Rs12.89 billion in accordance with the AGN Kazi Formula. The formula has been awaiting implementation for years together.

With the projected increase in the federal tax assignments from the current year's revised estimates of Rs15.74 billion to Rs20.36 billion, revenue on this specific account would go up by Rs4.61 billion.

The province would, for the first time, receive Rs866.66 million from the federal government on account of its octroi and Zila tax share.

NWFP's own receipts have been estimated at Rs4.25 billion as against the revised estimates of Rs3.92 billion for the current fiscal. Income under various heads has been projected at Rs1.74 billion, Rs2.4 billion and Rs101.56 million on account of tax receipts, non-tax receipts, and interest/dividend respectively. After deducting Rs955 million, which is believed to remain non-receivable, the net receipts will remain at Rs3.29 billion compared to Rs3.1 billion in the current fiscal.

Four sick units revival approved

The Committee for revival of sick units has approved the revival of four sick sugar mills after having a presentation on sugar industry by the financing banks.

Chairman of the Committee Tariq Hameed said after the meeting that eight sick sugar units were considered by the committee which approved the revival of four units and rejected remaining four.

Tariq Hameed said three of these units are located in Azad Jammu and Kashmir, NWFP and Kasur.

There are at least 78 sugar mills in the country and the committee did not want to take up revival cases of small units with 1,500 to 2,000 tons sugarcane crushing capacity per day.

Sugar mills with a crushing capacity of 4,000 tons to 6,000 tons were considered for revival purposes, he added.

Revival of sick units

The government is likely to issue an ordinance in early July to formally establish Corporate and Industrial Restructuring Corporation (CIRC) to revive on priority 144 sick industrial units.

Official sources said on Monday that draft law for the setting up of the proposed CIRC (previously known as Corporate Resolution Trust) has been prepared by the ministry of law for final approval by the cabinet.

The chairman of the Corporation, Tariq Hamid was looking for the approval of the ordinance to be issued to undertake the revival of 1000 units out of total of about little over 4000 units.

Steel Mill output

Pakistan Steel Mills Friday crossed the one million ton mark of steel production in the year 1999-2000.

Rice production strategy unveiled

The Punjab Agriculture Department has chalked out master plan to bring 3.689 million acres land under rice crop during 2000-2001, to achieve the production target of 2.377 million tons, at an average yield of 17.26 maund per acre.

Production of car, truck falls

The auto sector is expected to give a mixed performance in 1999-2000, showing fall in production of cars, light commercial vehicles (LCVs) and trucks as against rise in tractor and bus segments as compared to 1998-99.

Figures released by Pakistan Automotive Manufacturers Association (PAMA) reveal rolling out of 27,631 cars during July-May 1999-2000 as compared to the entire production of 38,619 units in 1998-99. Car production failed to pick up despite the fact that the production of Daihatsu Cuore 800cc, which was launched in March this year, reached to 883 units. Assemblers of Suzuki, Toyota, Nissan and Honda produced 33,684 units in 1997-98.