The Khyber Pakhtunkhwa government Friday presented Rs 923 billion tax-free budget with allocation of Rs 124 billion for health and Rs 317.8 billion for development expenditures.
Presenting the budget for financial year 2020-21 in the Khyber Pakhtunkhwa Assembly, Finance Minister Taimour Salim Jhagra said the total outlay of the budget is Rs 923 billion, including Rs 739.1 billon for settled districts and Rs 183.9 billion for the merged areas. About the ongoing expenditures, the finance minister said that a total of Rs 605.2 billion were allocated, out of which Rs 517.2 billion are for settled districts and Rs 88 billion for merged districts. Regarding development expenditure, he said a total of Rs 317.8 billion have been earmarked for the purpose, including Rs 221.9 billion for settled districts and Rs 95.9 billion for merged districts.
He said a record Rs124 billion were allocated for health sector for settled and merged districts, adding the budget for settled districts have increased from Rs 87 billion of outgoing fiscal to Rs 105.9 billion for upcoming fiscal year. For development budget in health sector, he said a total of Rs 24.4 billion were allocated, including Rs 13.8 billion for settled districts and Rs10.6 for merged districts.
He said government will focus to ensure adequate stock of equipment, medicines and increasing strength of doctors in public sector hospitals besides providing Sehat Insaf cards to every family of the province and in this regard Rs 10 billion have been allocated. He said Rs 36 billion have been earmarked for MTI hospitals, including Rs 26 billion for MTIs current budget and Rs 4 billion for completion of key projects besides Rs 6 billion for special demand funds for improving healthcare system in major hospitals. Shortage of infrastructure and equipment in basic health units will be overcome and for this purpose, Rs 13 billion project will be launched in collaboration with the World Bank.
Similarly, budget has been increased from Rs2.5 billion to Rs 4 billion for procurement of medicines in healthcare facilities besides acquiring services of private sectors with allocation of Rs 1 billion for waste management of hospitals.
The minister said separately Rs24 billion were allocated for emergency coronavirus relief fund to combat the deadly virus. Out of the total amount, Rs 15 billion would go for settled districts and Rs 9 billion for merged areas. He said maximum relief has been provided in taxes in budget 2020-21, adding the reforms in the KP Revenue Authority (KPRA) has yielded results as the income has been enhanced from Rs 10 billion to Rs 17 billion.
Despite Covid-19 challenges, the total income was estimated as Rs 36 billion for this year which is 20% more than the last year and had Covid-19 not surfaced the total income would have crossed Rs 45 billion. Jhagra said special aspect of the budget was tax relief and tax reforms, adding it is a tax-free budget as neither new tax has been imposed nor tax rate was enhanced.
Highlighting tax relief measures, the minister said the local government department has abolished taxes on 200 SMEs. Accordingly, excise and taxation department has also abolished concerned provincial taxes on small businesses and persons to avoid tax duplication, he said, adding that hotel tax and professional taxes will be abolished on all hotels and more than 18 professionals provided these people get their business registered with KPRA. Entertainment tax has been abolished altogether. To increase vehicles registration in KP, he said NOC’s condition from other provinces has been withdrawn.
Taimour Jhagra said sales tax rate on 27 categories has been reduced and restaurants which installed point of sales software tax rate would reduce from eight percent to 5%. The KP government has decided to uphold incentives on CVT and stamp duty to promote construction sector.
“Those professional categories, which were registered with KPRA were exempted from taxes include import and exports licenses holders, clearing agents/customs house agents, travel agents, restaurants, guest houses, professional caterers, lawn or marriage halls, advertisement agencies, doctors, diagnostic and therapeutic centres, contractors, suppliers and consultants, petrol, diesel, CNG, filing stations, all establishment including video shops, real estate agencies, car dealers, net café, chartered accountants, service stations, transporters, stock exchange members, money changers, health centres, gymnasiums and cable operators,” he said.
Jhagra said Rs 73 billion will be provided to merged areas under 10-year development program and during first three years’ focus will be made on education, health, employment and economic development while in the second phase concentration would be given to infrastructure, roads and other mega projects with special focus on quick resulted oriented projects in the third phase.
Giving details of the uplift schemes and allocation for different sectors in merged areas, the minister said Rs 1 billion allocated for provision of medicines, medical supplies at hospitals, Rs 1 billion for medical and non-medical equipment, Rs 1 billion for recruitment of doctors in remote areas, Rs800 million for six types D hospitals through health foundation, Rs700 million for services of 100 specialist consultants, Rs10 million for regional blood centre, Rs100 million for nurses and paramedics recruitment, and Rs50 million for establishment of trauma centres at districts headquarters hospitals in merged districts.
For education sector, the KP Government has allocated Rs3.7 billion for provision of stipends to male and female students of merged areas, Rs 2 billion for provision of basic and fulfillment of missing facilities through parents teachers committees, Rs 500 million for free books, Rs400 million for science and IT labs establishment, Rs 250 million for upgradation of 73 high schools to higher secondary level and 69 middle schools to high schools, Rs 50 million for education voucher schemes, Rs50 million for land acquirement for existing public colleges and construction of new buildings, Rs 490 million for transport facilities to colleges students and Rs 200 million for stipends to college students in merged areas.
The finance minister said the Government was also giving special attention on sports and tourism uplift in merged areas by allocating Rs1.2 billion for establishment and improvement of sports facilities in the budget 2020-21, Rs1.15 billion for youth development, Rs400 million for sports promotion, Rs100 million for startup program and Rs100 million for holding art and culture events in merged districts.
