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Pakistan’s Economy - Budget Anlysis

Autor:   •  August 25, 2017  •  8,065 Words (33 Pages)  •  697 Views

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MAIN COMPONENTS OF REVENUE IN BUDGET 2014-15

Capital Value Tax (CVT)

It’s basically a tax on immobile property; government feels that in 2014-15 they overall collect higher CVT than previous year because they believed that they have better FBR dogmas that will achieve the target. Capital Value Tax (CVT) revised on 2013-14 budget was Rs 590 million which were increase by Rs 89 million or 16% to Rs 679 million in 2014-15 budget.

Income Support Levy

Income Support levy budgeted on 2013-14 about Rs 6,000 million and revised on 2013-14 budget was nil so government not focus this component of direct tax in 2014-15 budget. Indirect taxes have following apparatuses: Other taxes are projected to increase by Rs 80,265 million or 33.5% to Rs 319,210 million in 2014-15 budget. As a consequence, the applicability of the Act in respect of tax years 2014-2015 need to be seen as this may create litigation that’s the reason government didn’t remark any amount on 2014-15 budget.

Other Indirect Tax

Other indirect tax revised on 2013-14 budget was about Rs 3,860 million which were increase by Rs 860 million or 22% to Rs 4,720 million in 2014-15 budget. This indirect tax include value added tax, specific tax etc. which can bear by absolute consumer but through this government afford amenities to the novices of the nation.

Airport Tax

Airport Tax revised on 2013-14 budget was about Rs 85 million which were increase by Rs 5 million or 0.58% to Rs 90 million in 2014-15 budget. An airport tax or service charge is a superfluous fee charged to departing and linking passengers at an airport. It is imposed by government or an airport controlling concern and the proceeds are usually proposed for funding of major airport enhancements or enlargement or airport service.

Gas Infrastructure Tax

Gas Infrastructure development Cass revised on 2013-14 budget was about Rs 88,000 million which were increase by Rs 57,000 million or 64.7% to Rs 145,000 million in 2014-15 budget.

Petroleum Levy Tax

Purpose of this tax is to mend the refinery system in Pakistan and to stun the deficit of import in petroleum flank. These taxes are levied on import and refineries of gasoline in Pakistan, these prices are already included in petrol and lubricant prices. Petroleum Levy revised on 2013-14 budget was about Rs 108,000 million which were increase by Rs 15,000 million or 14% to Rs 123,000 million in 2014-15 budget.

MAIN COMPONENTS OF EXPENDITURE IN BUDGET 2014-15

Administration of Civil Government

The expense of civil governments are included salary payments, allowances, non-salary and others for this purpose government allocated the budget in 2014-2015 the amount of 290,660 million. In 2013-2014 this amount shows 274,693 which is increase in 2014-2015 budget.

General Public Service

Under the head of General Public Service, the major portion goes to executive & legislative organs, financial, fiscal and external affairs. At Rs 2,119,013 million, this component forms 83.3% of the allocation for General Public Service. The main heads of expenses are Servicing of Domestic Debt, Foreign Loans Repayment and Others. Transfer payments constitute another important item.

Foreign Loan Payments

Foreign loan payment is a major problem for government, it took a loans from foreign countries and then they have to payment these loans for this purpose government allocated 333,174 million in 2014-2015 budget.

Health and Education Services

The expenditure in Health Affairs and Services was estimated around of Rs 10,017 million has been made in the budget estimates 2014-15, which is higher by 1.6% and 6.2% respectively when compared with budget and revised estimates 2013-14.

Education Affairs and Services have been provided with Rs 64,014 million in the budget estimates 2014-15 as compared with Rs 59,277 million in budget estimates 2013-14 and Rs 63,442 million in revised estimates 2013-14.

Subsidies

In budget 2014-15, the allocation for subsidies to WAPDA / PEPCO forms the major component, which is 76.8% of the total allocation followed by subsidy to KESC with share of 14.3%. A total estimate of expenditure in federal budget 2014-15 for subsidies is 0.7% of GDP.

Development Loans and Advances

For budget 2014-15, total development loans and advances have been estimated at Rs 318,735 million, showing an increase of 17% over revised estimates 2013-14 and 62.2% over budget estimates 2013-14. Total development loans and advances (local and external) were estimated at Rs 196,494 million in the budget 2013-14, which have now been revised upwards to Rs 272,506 million in revised estimates 2013-14. Development loans and advances are made by the Federal Government to Provinces, Government of Azad Jammu & Kashmir, Public Sector Enterprises (PSEs), Financial / Non-Financial Institutions, District Governments / TMAs, and Others to assist them in carrying out their development programs. For budget 2014-15, development loans and advances (local) have been estimated at Rs 118,875 million, while development loans and advances (external) at Rs 199,860 million.

Economic Affairs

The allocation under the head of Economic Affairs in the budget 2014-15 has been projected at Rs 47,585 million, which is higher by 10.7% than the revised estimates for 2013-14, but lower by 9% as compared to budget estimates 2013-14. Major share of this head goes to Agriculture, Food, Irrigation, Forestry and Fishing, which is 43.1% of total allocation for Economic Affairs.

Current Investment

Current investment is one the major component of expenditure in budget for any nation because it can earn revenue for the government in future and give country economic progress. The federal current investments for the year 2014-15 have been estimated at Rs 18,112 million as compared with Rs 144,050 million in the revised estimates of 2013-14 and Rs 184,461 million in budget estimates 2013-14.

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