Provincial budgets

The actual point where development is to be delivered 

The Sindh Budget was presented by Chief Minister Murad Ali Shah on Friday, a day after the Punjab Budget on Thursday, which in turn was presented by Finance Minister Mujtaba Shujaur Rehman on a day after Federal Finance Minister Muhammad Aurangzeb presented the Federation’s. KP had broken precedent on May 25, when provincial Finance Minister Aftab Alam Afridi presented the budget ahead of the federal. That leaves only Balochistan of the provinces, to have its budget presented, which should happen on Saturday (today), now that the provincial government has given its approval. Incidentally, Balochistan is still the only province to have a budget of less than a trillion rupees.

Another interesting feature of all provinces (including what has been learnt of Balochistan’s) is that they are ‘tax–free’. Not in the sense that any previous taxes have been lifted, but that there has been no change in any of the already existing taxes. This leads again to the question being asked about the agriculture income tax, which is a provincial subject, and thus means that the provinces alone have the power of taxing it. Technically, they do, but as it is based on Production Index Units of the land, it has merely replaced the old land revenue, which has been abolished. By obtaining some agricultural land, one can show income-generating businesses as losing, while the income comes from agricultural land. The exemption also explains the phenomenon of ‘feudal lords’, who pay no income tax, because all their (vast) income comes from agriculture. These are the people who enter the Assemblies, having large sums they can spend on elections, both National and provincial, where they protect their privileges tigerishly. The National Assembly never ends the constitutional protection, while the provincial assemblies never levy an agricultural income tax. This year, none of the provinces has taken any step on this, even though the federal government is facing heavy pressures on its finances.

It should not be forgotten that the provincial governments are at the coalface of the mine, delivering services which the federal government does not. The provinces have total responsibility for law and order, health and education, and while the Constitution does provide for the federal government to step in where law and order cannot be controlled, it is silent on what happens where healthcare or education break down.  These budgets are where nurses and primary school teachers are paid. It is thus essential to ensure that they are properly funded.

The Editorial Department of Pakistan Today can be contacted at: [email protected].


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