KARACHI: Pakistan Peoples Party lawmakers on Saturday rejected the federal budget for financial year 2018-19 and termed it “PML-N’s last election-year stunt”.

“This so-called budget is full of figure-fudging, budgetary summersaults, false slogans and unsustainable tax measures that would only make things difficult for the next elected government,” senior PPP leader MNA Naveed Qamar told a press conference here at the party’s media cell office.

He was accompanied by MNA Nafisa Shah, who is also the central information secretary of the PPP.

The party also expresses concerns over huge hike in petroleum development levy

She said: “We have repeatedly alerted the government against presenting the sixth budget although the government has a term of five years. This is legally improper and in the election year is tantamount to pre-poll rigging.”

The PPP lawmakers said the state of economy could be gauged from the fact that the rupee lost more than 10 per cent of its value in a free fall in three months.

“For more than three years, for political gains, exchange rate was artificially being maintained by Mr [Ishaq] Dar which even the current finance minister conceded,” said Mr Qamar. “The Mujhe kyun nikala-focused government has only given increased income inequality, a deepening debt trap, a gaping current account deficit, fast drying forex reserves making the projected growth unsustainable.”

While rejecting the budget totally, they pointed out loopholes, gaps and contradictions.

They said the government’s target of 6.2 per cent growth and 4.9pc fiscal deficit seemed unrealistic. “With a huge $12 billion current account deficit, $29bn trade gap, and $10.9bn reserves worth only three months of imports, makes the macroeconomic picture weak and bleak.”

They added all the targets in the budget seemed unsustainable and unrealistic as the incoming government would be piled with challenges of fixing the fundamental macroeconomic indicators.

“With a huge public debt of Rs23 trillion and an external debt of up to $90bn, this far exceeds the National Fiscal Responsibility and Debt Limitation Act 2005 as this amounts to nearly 69pc of the GDP as against permissible limit of 60pc. The proposal to cut that to 63.2pc mentioned in the macroeconomic framework paper makes no sense as the proposed fiscal deficit is about five per cent.”

No mention of minimum wage

They said that was the first budget where there was no mention of minimum wage. “It is clear the PML-N government hates the working classes, but leaving out minimum wages from the budget is unacceptable.”

The PPP lawmakers said that the government had proposed a tax target with more than 10pc increase, which was inexplicable. “How this can been achieved with simultaneous tax relief that has been proposed.”

“There is much deception in the budget,” said Ms Shah, “We have just heard the government intends to increase petroleum development levy three times from Rs10 a litre to Rs30 a litre. This added revenue is not a part of the federal divisible pool although every Pakistani is being charged for it.”

Besides, she said there was a huge difference between individual tax at 15pc and corporate tax at 30pc. “Coming in the election year this seems like a PML-N ploy to please individual taxpayers.”

They said there was a sharp cut in the public sector development programme (PSDP) both for provinces and the federal government. The fiscal deficit should be cut in reducing current expenditures, not new development. “Only Rs800bn is allocated, making it only 2.4pc of GDP. But then at the same time Rs232.5bn is placed in the discretionary schemes.”

Further, they added, Rs230bn had been mentioned for development through self-financing through corporations. “But, which corporations are these, and how will this self-finance be raised?”

They said debt servicing and repayment and defence budget combined exceeded net receipts in the budget. “There is no solution given for the circular debt of nearly Rs1tr and public sector enterprises’ debt of another Rs1tr.”

Mr Qamar said: “There is no mention of nearly Rs250bn refunds that are payable to the business community. And, fanciful schemes like 100, or 400 vocational schools is simply ridiculous as there is no way this target can be achieved in one month.”

Published in Dawn, April 29th, 2018