THE Punjab caretaker government, which launched a number of people-friendly plans and programmes during the last few months, has approved a tax free budget of Rs1.72 trillion for four months — July to October — of the fiscal year 2023-24. In the absence of the provincial assembly that stands dissolved the caretaker cabinet approved the spending plan for four months under article 126 of the Constitution.
The very decision of the caretaker government to present a budget just for four months and leave the budgetary exercise to the next elected government is reflective of its preference for transparency and fairness in governance. However, despite the limited nature of the budgetary estimates, the proposals for the next year reflect a desire to provide maximum relief to the people and spur growth. In line with this policy, no new tax has been imposed and the cabinet rejected a proposal to increase the existing stamp duty of one percent to three percent to support the construction sector. Again, all provincial duties and taxes on the IT sector have been abolished and the establishment of an IT Park has also been approved. An endowment fund of Rs1bn has been established for journalists. In a significant move, block allocation has been made in the budget to check inflation and a process would be initiated to retire costly wheat loans in four months. Under another important decision taken by the provincial government, retiring employees would continue to get 65% of their salary for one year after their retirement. This incentive, notwithstanding, the budget came as a rude shock to the provincial employees and pensioners. Traditionally, provincial government follow the footsteps of the centre in granting an increase in salaries and pensions but strangely enough the caretakers discriminated against them by allowing a meagre 5% increase in pension for the majority (against 17.5% across the board by the federal government) and 30% increase for all employees (whereas employees from Grade-1 to 16 got 35% increase in the federal budget). Punjab government employees and pensioners are not living in a paradise and are equally affected by the record inflation, therefore, the province needs to review its decision.
