By Special Correspondent
ISLAMABAD: President Arif Alvi on Thursday accorded approval to the Finance (Supplementary) Bill, 2023, generally known as the mini-budget, as the government rushed to meet the International Monetary Fund’s conditions to unlock an economic bailout that the country needs to avoid default risk.
The Prime Minister Secretariat had sent the bill to the President a day earlier for assent – two days after the National Assembly passed it. “The president gave the approval to the bill in accordance with Article 75 of the Constitution,” President House media said in a statement on Thursday.
Under Article 75 (1) of the constitution, the president has no powers to reject or object to the finance bill – a money bill as per the constitution. The article reads “When a Bill is presented to the President for assent, the President shall, within [ten] days,–(a) assent to the Bill; or (b) in the case of a Bill other than a Money Bill, return the Bill to the Majlis-e-Shoora (Parliament) with a message requesting that the Bill or any specified provision thereof, be reconsidered and that any amendment specified in the message be considered”.
With the efforts continuing to implement all major prior actions, Pakistan is eyeing a staff-level agreement with the global lender running week which will also make possible much-awaited credit flows from other multilateral and bilateral lenders.
According to the sources, Pakistan and the International Monetary Fund are likely to sign the staff-level agreement on February 28. This will be followed by the IMF executive board meeting expected in the first week of the next month.
Finance Bill
The global lender had asked the Pakistani government to raise an additional Rs 170bn in tax revenue. The bill had sought increasing General Sales Tax from 17 percent to 25pc on 33 categories of goods covering 860 tariff lines including imported food, decoration items, high-end mobile phones and other luxury goods. Through the finance bill (mini budget) , the excise duty on cement has been raised from Rs 1.5 to Rs 2 per kilogram, a decision estimated to fetch another Rs 6bn. The excise duty on carbonated/aerated drinks has been hiked to 20pc from 13pc to raise an additional Rs 10bn for the national kitty.
A new excise tax of 10pc was sought on non-aerated drinks like juices —orange, mango, etc. — to raise an additional tax of Rs 4bn. The increase in excise duty on business, club and first-class air tickets will raise an additional Rs10 bn.
Pakistan is in dire need of funds as it battles an economic crisis with foreign exchange reserves falling to around $3bn, barely enough to cover three weeks of controlled imports.
