ISLAMABAD: Pakistan’s Minister for Finance and Revenue Muhammad Aurangzeb said on Wednesday that the federal government has eliminated additional customs duties on 4,000 tariff lines out of a total 7,000, and also reduced duties on a further 2,700.
Speaking at a post–budget press briefing, Aurangzeb described the tariff rationalisation as a “major and important step” in aligning Pakistan’s trade and industrial policy with global standards.
The initiative, he said, marks the beginning of a phased plan towards a simplified tariff regime, ultimately targeting an average tariff rate of just over four per cent.
Industrial growth
The government’s broader goal, according to the finance minister, is to reshape Pakistan’s tariff architecture in a way that supports industrial growth and integrates the economy more deeply into global supply chains.
Salaries and pensions
The minister emphasised that structural reforms will be taken forward. He said that given the fiscal space available, the government tried to provide relief to the employees as much as possible. He added that increase in salaries and pensions has been linked with the inflation.
To a question, the minister said, the increases in salaries and pensions were directly linked to the headline inflation, Consumer Price Index (CPI), ensuring adjustments reflect inflationary pressures.
He said this time the expenditure of government has just increased by less than two per cent.
“Backbone of our economy”
He reaffirmed the government’s commitment to agriculture as the central engine of economic growth, with a particular focus on dairy and livestock, which account for 60 per cent of the sector’s GDP. “Agriculture has been, and will remain, the backbone of our economy,” he said.
He said, “We will work with the provinces to extend more support to the small farmers”. He said loans will be given to the small farmers.
He said an additional tax had to be imposed on fertilisers and pesticides this time but on the directions of the prime minister no additional tax has been imposed.
He said that tax to GDP ratio will be 10.3 per cent this year while this will reach 10.9 per cent next year. He said revenue collection has been enhanced through better enforcement, emphasising that they are coming up with a legislation to further improve enforcement measures.
