A mini-budget is greatly plausible on the cards as the administration wishes to put forward a more Rs. 60 billion earnings to offset post-flood aftershocks.
These responsibilities could be assessed as a levy via a Presidential Ordinance, which would keep the capital exterior of the national separable reservoir and not be routed under the National Finance Commission (NFC) medals. Moreover, the levy won’t be counted as part of the Federal Board of Revenue (FBR) collection because it is not a tax, reported Express Tribune.
The first draft of the Presidential Ordinance is reportedly ready and awaiting approval. It could go into effect as early as Sunday. But if the government decides to include the windfall income tax on commercial banks in the ordinance, it could get delayed.
The Ordinance may also strengthen the government’s case in the eyes of the International Monetary Fund (IMF), provided it takes adequate measures to offset the massive revenue shortfall. In any case, the 1-3 percent flood levy could be imposed on currency-exempted imported goods, except those exempted under the 5th Schedule of the Customs Act or the Vienna Convention.
The initial plan was to impose up to 3 percent additional customs duties to compensate for a Rs. 100 billion deficit in the annual collection target for customs duties. Now, it is possible that a 2 percent tax will be levied on goods that are not classified as luxury items. Added to this, luxury items may be subject to a 3 percent tax as well.
