KARACHI: The Sindh government expects to collect Rs3.2 billion from rationalisation of excise duty, broadening of the sales tax net on services, increase of fee on transfer of motorcycles and commercial vehicles and lifetime tax on motorcycles.

This was stated by Syed Murad Ali Shah, adviser to the Sindh chief minister on finance, while addressing the post-budget press conference on Saturday at the CM House.

Responding to a question, he said the government had almost finalised agricultural reforms whose draft was ready and could be taken up for consideration after the budget session. All stakeholders, including growers, had been taken on board, he added.

Referring to reduction in annual development programme (ADP) estimates as compared to last estimates, the adviser pointed out that 80 per cent of the provincial resources came from the federal government and if the federal government failed to perform collection work, its impacted provinces also.

He said the federal government, which had earlier estimated to collect Rs2,475 billion, had promised to give Sindh Rs332 billion and as such the Sindh government made the ADP for Rs185 billion in 2013-14 but in January and May, the estimates for collection were changed to Rs2,385 billion and Rs2,275 billion respectively, the government had to revise the ADP from Rs185 billion to Rs115 billion.

He said Sindh had received the last tranche of March from the federal pool while the releases for April, May and June tranches from the pool were yet to be received. At present these transfers were being made every fortnightly which was causing delay and complications.

Mr Shah, who was accompanied by Information Minister Sharjeel Memon, additional chief secretary Waseem Malik, chairman of the Sindh Revenue Board Syed Tashfeen and secretary finance Sohail Rajput, information secretary Zulfiqar Shalwani, stressed the need for transfers on a daily basis of collection, because due to the delay the Sindh government had to go for borrowing from banks to meet liabilities.

Mr Shah said that another important issue affecting the federal government and the province of Sindh pertained to levy of gas infrastructure development cess in violation of Article 161, which gives the provinces 100 per cent right on royalty and excise duty on gas, but despite objections the federal government during the last three years had collected so far Rs131 billion and for the new financial year this cess was estimated Rs145 billion.

He said that Sindh demanded that entire amount of the cess be transferred to the provinces, but as Sindh produces 70 per cent of total gas production in the country, 70 per cent of this amount be transferred to Sindh immediately.

In reply to a question, he said that the total budget outlay for the year 2014-15 was pitched at Rs686.17 billion as against the budget estimates of Rs617.21 billion while total receipts of the province were estimated at Rs672.11 billion as against the last year’s estimates of Rs595.57 billion and federal receipts were projected at Rs474.26 as against Rs409.01 billion.

The Sindh own receipts were estimated at Rs125.06 billion for the year 2014-15 which was an increase by four per cent over budget estimates of Rs120.18 billion, he said.

The Sindh Revenue Board was expected to collect Rs49 billion in 2014-15, which would be an increase of 17 per cent over current year’s estimates of Rs42 billion, he added.

To another question, the adviser said the government had accorded highest priority to the law and order issues of the province and allocated Rs55.907 billion for the purpose. Out of this Rs50.820 billion was set aside for the Sindh police and Rs2.222 billion for the Rangers and Rs942.726 million for the Frontier Constabulary and Rs1.316 billion for training and research in law and order.

Mr Waseem Malik, highlighting the salient features of the ADP 2014-15, said the government had prepared a reforms plan for resource mobilisation and through better management and administration provincial tax receipts would be increased from the current Rs91.37 billion to Rs300 billion in next three years.

He said that a total of 149 schemes with a combined length of 2026 km had been completed in road sector during the outgoing year while in the ADP 2014-15 targets had been set for constructing 305km new roads, improvement of 470km roads and construction of 11 new bridges.

This year Rs20 billion for energy sector was allocated, including Rs13.5 billion for Thar coal infrastructure and Rs7 billion for power development initiatives, he added.

He said that all the provincial governments in general and Sindh in particular were accused of defaulting on their electricity bill payments. The Sindh government, he pointed out, that on all relevant forums, categorically stated that it was willing to pay all its electricity dues, if they were genuine.

For clearing the dues, the government had allocated Rs26 billion in comparison to Rs9.5 billion provided during the past year. This included Rs4 billion to be paid to the local bodies, he added.

The maintenance and repair (M&R) budget for buildings was increased by 58 per cent from Rs5.771 billion to Rs9.148 billion in the next year and the M&R for roads by 72 per cent from Rs1.451 billion in the outgoing year to Rs2.505 billion.

Malik Waseem said that the government was working to provide relief to commuters at the earliest and had planned a strategy to start yellow line project which was the first of many metro bus projects for the people of Karachi and would operate along the Korangi 8000 road leading up to the city centre. The other major project being under taken was Karachi-Thatta dual carriageway.

He said in the ADP for Karachi package was worth Rs4.19 billion, for S-III Rs1,040 million was allocated in this budget while the federal government had allocated Rs200 million and to resolve the transport issues of Karachi Rs3 billion was provided for the green line service.

Besides, he said, an amount of Rs13.23 billion was earmarked for special development packages for various districts, including Hyderabad, Shaheed Benazirabad, Larkana, Karachi, Sukkur, Dadu, Sanghar, Mirpurkhas, Tharparkar, Jacobabad, Kashmore, Thatta, and Sujawal.

The allocation for agriculture sector in development budget was Rs4.4 billion and a provision of Rs567.81 million was made in ADP for construction of Mandirs (temples), in Karachi, Ghotki, Thatta, Sukkur, Matiari, Shikarpur, Sanghar, Tharparker, Larkana, Umerkot and Khairpur Mirs districts.

He said in the ADP 2014-15 the total development outlay was estimated at Rs215.359 billion while for ongoing 1,658 schemes, Rs90.820 billion was allocated which was 63.5 per cent of the total allocation while for 1,279 new schemes the allocation was Rs52.180 billion, which was 36.5 per cent of the total allocation of Rs143 billion.

In the education sector, out of Rs10.709 billion, Rs8.518 billion was set aside for ongoing schemes and Rs2.190 billion for new schemes.

In the health sector out of Rs13.224 billion allocation, Rs11.197 billion was earmarked for ongoing schemes and Rs2.027 billion for new schemes.

Similarly, for local government out of Rs21.886 billion, Rs12.269 billion was set for ongoing schemes while Rs9.617 billion for new schemes and for mega projects a total amount of Rs6 billion was allocated for new schemes.

Published in Dawn, June 15th, 2014