ISLAMABAD:
The federal budget, with an estimated total volume of approximately Rs18,000 billion, is to be presented for the fiscal year 2024-25 in Parliament on Wednesday. The budget is expected to include a 10-15% salary increase for public employees and a tax collection target of Rs12.9 trillion.
The federal government is also likely to hike the pensions of retired employees by 10%. Besides, a proposal to increase the Employees’ Old-Age Benefits Institution (EOBI) funds is also under consideration.
However, the final decision will be made by the government after reviewing the recommendations of the finance ministry. If approved, the increase will take effect from July this year.
Federal Finance Minister Muhammad Aurangzeb described pension payments as a “big liability”.
Sources indicate that the budget will allocate Rs9.5 trillion for interest and debt payments. Subsidies for the energy sector are expected to be set at Rs800 billion. Additionally, the federal tax revenue is projected to be around Rs12.9 trillion, with non-tax revenue estimated at Rs2,100 billion.
To meet the additional tax target, a potential 1% increase in the sales tax rate is anticipated, which is expected to generate significant additional revenue.
