ISLAMABAD, May 31: President Gen Pervez Musharraf has authorised the provincial governments to immediately constitute the membership of their provincial finance commissions (PFCs) based on their own needs so that the provincial finance awards could be included in the coming provincial budgets.
Presiding over a meeting to review the progress on setting up of provincial finance commissions and provincial finance awards here on Friday, the president also directed that the entire 2.5 per cent general sales tax collected by the federal government in lieu of Octroi and Zila tax be provided to the provinces for onward transfers to the local governments.
He directed finance minister Shaukat Aziz to come up with a workable formula after seeking consensus from the provinces on distribution of 2.5 per cent among the provinces.
Finance minister Shaukat Aziz, provincial finance ministers and chairman National Reconstruction Bureau (NRB) attended the meeting.
The president directed the provincial ministers to institutionalize fiscal devolution by following simple formula based approach acceptable to the provincial finance commissions.
The minister also updated the meeting on the progress made by these groups and said the entire exercise would be completed in the next few months.
