Finance minister says no option but to ask for IMF’s help, NA passes mini-budget

The National Assembly (NA) on Thursday passed the Finance (Supplementary) Bill, 2021, termed widely as a “mini-budget”, despite vociferous protests by the Opposition over rejection of their proposed amendments and disagreement over the vote count. The Pakistan Tehreek-e-Insaf (PTI) led coalition government bulldozed 16 pieces of legislation.

The approval of the supplementary finance bill was necessary to ensure Pakistan’s sixth review of the $6 billion Extended Fund Facility (EFE) gets cleared by the IMF’s Executive Board which is scheduled to meet later this month to decide the disbursement of the $1-billion tranche.

The prime minister, who generally only attends parliamentary sittings at crucial junctures, remained in the house for most of the session’s duration, which lasted until midnight.

Opposition Leader Shehbaz Sharif, Pakistan Peoples Party (PPP) chairman Bilawal Bhutto-Zardari and former president Asif Zardari also remained in the assembly for most of the session. They initially left the house after the first vote on the amendment but rushed back to their seats when the speaker ordered another physical vote on the opposition’s demand.

In the amended bill, the government rolled back its plan to impose additional sales taxes on children’s formula milk, bread, and small cars. It also withdrew the proposal to impose taxes on laptops and computers.

The government’s amendments to the proposed bill were approved by the NA. The changes include:

No general sales tax will be imposed on a 200-gram carton of milk.

A 17 per cent GST will be imposed on formula milk worth Rs500.

Tax on imported vehicles has been increased from 5 per cent to 12.5 per cent.

The federal excise duty on all imported vehicles will remain unchanged.

A 2.5 per cent duty will be charged on locally manufactured 1,300 cc vehicles, which was previously around 5 per cent.

Duty on locally manufactured 1,300 to 2,000cc cars was also reduced to 5 per cent from 10 per cent.

A 10 per cent duty will be imposed on locally manufactured cars greater than 2,100 cc.

No sales tax will be imposed on iodised salt and red chilies.

Opposition members made an attempt to disrupt proceedings by pointing out quorum, but the chair hastily called for presentation of the bills one after the other, reports Dawn.

The Opposition also protested the non-laying of Senate recommendations on the finance bill before the house for consideration, with Pakistan Muslim League-Nawaz (PML-N) leader Ahsan Iqbal terming it an “insult to the Senate”.

“If you suspend the rules and bulldoze the bill in the darkness of the night, your name will go down in history among those who conspired to sell the country’s economic sovereignty,” he said.

“Why are we giving an impression that we are doing it on gunpoint,” asked PPP’s Syed Naveed Qamar.

Bilawal termed the SBP Bill a threat to national security and questioned why the government was making it binding to have only one bank account for defence expenditures. By doing so, he said they were providing an opportunity to world powers to scrutinise the country’s defence budget and its nuclear programme which, he added, could be the next target.

“Your prime minister has been installed to destroy Pakistan politically and economically,” said Asad Mehmood of the Jamiat Ulema-i-Islam (JUI-F).

Shedding light on the criticism regarding the supplementary bill being the “International Monetary Fund (IMF) bill”, Finance Minister Shaukat Tarin said that during the previous government’s tenure, 13 agreements were signed with the Fund.

“They [the Opposition] are saying that IMF has destroyed the economy of Pakistan, while they went to the IMF in their tenures as well,” he said.

Tarin further said that the PTI government is being accused of “mortgaging country’s sovereignty”; however, the government was forced to approach the IMF.

“We had no other option but to ask for IMF’s help,” he reiterated.

However, Defence Minister Pervez Khattak seemed to lose his patience with the process and, at one point, asked the speaker to ignore the opposition and “bulldoze” the bills through.

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