THE incentives given to different sectors of the economy in federal budget 2021-22 especially to industries and agriculture are widely being hailed with business tycoons such as Chairman Nishat Group Mian Muhammad Mansha also expressing their confidence of positive results of budgetary proposals.
In fact it is the first budget that has attracted less criticism and that too mainly from the opposition and wider acceptance from other strata of society.
The government must now refrain from any such step that dilutes this feel-good factor.
Addressing the post budget news conference on Saturday, Finance Minister Shaukat Tarin said the government has no option but to hike petroleum levy to Rs 25 to Rs 30 per litre for collecting over Rs 600 billion in the next budget.
Certainly, international oil prices have gone up and it goes to the credit of PTI government for not passing on this increase to consumers over the last one and a half month or so.
However increasing the prices now by Rs 25 or Rs 30 will only add to inflationary pressure that is already felt badly by common man. Steep price hike has seriously dented popularity of the PTI.
We, therefore, will suggest the government to rationalise the revenue target set for Petroleum Levy. As Saudi Arabia has also agreed to provide oil to Pakistan on deferred payment, it will also provide a cushion to government to extend maximum relief to the people on oil prices.
Instead of relying much on levy, the government must accelerate tax reforms and bring more sectors and people into the tax net to achieve tax collection target set for the next fiscal year.