Tarin stresses on consumption, income tax in Economic Survey 2021

02:36 PM | 10 Jun, 2021
Tarin stresses on consumption, income tax in Economic Survey 2021
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ISLAMABAD – Federal Finance Minister Shaukat Tarin Thursday unveiled the Economic Survey of Pakistan 2020-21.

Tarin, while speaking at the pre-budget 2021-22 press conference, said Pakistan will end this fiscal year with a surprise growth figure of 3.9 percent, beating several earlier projections that fell in the range of 1-2.

He said countries around the world usually boost their tax revenue by focusing on indirect taxation first. However, as Pakistan moves forward, the focus will be on consumption and income tax.

He blamed World Bank and the International Monetary Fund for downplaying the country’s economic growth. Adding that the government itself projected GDP growth rate at 2.1 percent, which is higher than the prediction of IMF and World Bank.

The new Finance Minister said ‘economy is recovering as Pakistan's remittances had broken records. Remittances had crossed $26bn adding that lately imports, especially food in the form of wheat and sugar, were increasing. The surge in remittances represents overseas Pakistanis’ trust in the premier.

Tarin said FBR tax collection recorded over 50 percent growth over the past three to four months. “We have set FBR tax collection target in the next budget at Rs5.8 trillion”, he disclosed. State Bank of Pakistan’s (SBP) reserves has also risen to $16 billion

Pakistan was a net exporter of food but now, we have become a net importer. Our exports registered a growth but our remittances increased manifold, he said.

Tarin, while addressing criticism, said the government was increasing debt. It was inevitable that the debt had to rise considering there was a fiscal deficit in the country.

The country’s total debt has soared by only 1.7 trillion from 2020-21; he appreciated the numbers saying the decline compared to the previous years is considerable.

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Government move to facilitate manufacturing and textile industries, as well as construction and agriculture sectors, helped the economy recover, he pointed out. Adding that large-scale manufacturing goes up by 9pc, while the agriculture sector growth was recorded at 2.77 percent against a target of 2.8.

The agriculture sector fared well despite the fact that the cotton crop was damaged; he said and added other crops made up for the loss incurred due to the cotton crop damage. He acknowledged that prices of commodities are high and taking a heavy toll on the common man despite the government’s efforts to bring down inflation.

The former banker also hailed the role of the IT sector in the South Asian country, saying that it will be promoted in the coming fiscal year. The IT sector is growing by 40 percent. We want to see a growth of 100 percent in the coming year.

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Highlighting the impact of novel Covid-19 in causing the economy to contract in 2020, he said the decisions of the incumbent government under the supervision of Prime Minister Imran Khan stablised the economy which resulted in improving performance on the growth front.

He reiterated economic hardships due to the pandemic last year as 20 million people were rendered jobless. Tarin hailed the premier’s decision to go for smart lockdowns instead of a complete lockdown to tackle the pandemic without damaging huge losses.