Sindh presents Rs1,477.9b tax-free budget

Amid strong protest by the whistleblowing members of three major opposition parties, CM Syed Murad Ali Shah presented in the Sindh Assembly a Rs1,477.9 billion tax-free budget with a development outlay of Rs329b.

He said the economic meltdown due to Covid-19 and inflation had severely affected the lives of ordinary citizens. "We are sensitive to the hardships being faced by the common man and it was against this background that we stretched our resources and rolled out interventions that could provide some immediate relief," he said, adding: "We began some programmes for empowering the vulnerable sections of our society to gradually move towards 'inclusive growth'."

Highlighting some of the projects of immediate relief to the common man, the chief minister said an amount of Rs17.4b had been set aside as 'health risk allowance' for all health professionals in the financial year 2020-21.

CM Shah regretted that actual transfers to Sindh in a fiscal year always fell short of the estimates as the Federal Board of Revenue missed the collection target set for it. "The federal government is the major contributor to province's finances comprising 72.5 per cent in its entirety," he said, adding that it was a fact that these shares inevitably fell short of the estimates provided every year, as a result, the provincial development expenditure had to be adjusted to offset the effect.

Mr Shah said that against an estimated budgetary amount of Rs1,073.7b, the revised receipts of the province for the financial year 2020-21 stood at Rs960.4b. "We are facing a shortfall on account of federal transfers as during 11 months of this financial year against budgeted receipts of Rs696.944b, we have only received Rs623.619b," he said, adding that based on these figures the province would be facing a shortfall of Rs83.8b.

He said the federal PSDP receipts were revised to Rs8.302b, whereas revised foreign project assistance stood at Rs38.29b. "The provincial tax and non-tax receipt is revised to Rs242.9b against an estimated target of Rs313.4b."

The chief minister said total receipts of the province for the financial year 2021-22 were estimated at Rs1.452 trillion as against budget estimate of Rs1.22tr for the current financial year, showing an increase of 19 per cent. "Receipts from the federal government on account of revenue assignment, straight transfers and grants are estimated at Rs869.68bn, which constitute 72.5 per cent of total receipts of the province, showing an increase of 12.6pc, over estimates of Rs760.3bn last year," he added.

Mr Shah said the budget estimates of straight transfers for the next financial year had decreased by 20.6pc to Rs49.5bn from Rs62.34bn of the current financial year, adding that the receipts of federal PSDP were estimated at Rs5.37bn. He said the receipts on account of foreign project assistance, budgetary support loans and grants were estimated at Rs71bn, adding that the provincial own sources on account of tax and non-tax receipts were estimated at Rs329.033bn, which constituted 27.5pc of the total receipts. "This is an increase of 4.8pc over estimates of Rs313.4bn of the current financial year," he said.

The total budget outlay for the financial year 2021-22 is estimated at Rs1.477tr as against Rs1.241tr for the current financial year, showing an increase of 19pc. CM Shah said the current expenditure of the province was projected at Rs1.14tr, which included current revenue expenditure of Rs1.089tr and current capital expenditure of Rs59.49b.