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PM Shehbaz announces 10% super tax on large-scale industries

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  • PM Shehbaz takes people into confidence over “tough decisions” taken by coalition govt.
  • “Our motive is to provide relief to the masses and to reduce burden of inflation,” he says.
  • PTI leader criticise govt for imposing 10% super on 13 sectors.

ISLAMABAD: Prime Minister Shehbaz Sharif announced Friday that the coalition government plans to impose a 10% super tax on large-scale industries, and that “tough decisions” have been taken to protect the economy on budget 2022-23.

Addressing the nation, after a meeting with his economic team, the premier said that the coalition government has taken some “tough decisions” regarding the federal budget for the next fiscal year 2022-23. “I want to brief the people about those decisions and the actual [economic] situation of the country,” he said, highlighting the two major reasons behind these decisions.

“Our first motive is to provide relief to the masses and to reduce the burden of inflation on the people and facilitate them,” he elaborated.

“Our second motive is to protect the country from going bankrupt,” he said, adding that it has been devastated due to the “incompetency and corruption” of the previous Imran Khan-led government.

The decisions taken now will save the country from bankruptcy, he vowed.

Meanwhile, PM Shehbaz further added that other motives included stabilisation of the economy and prosperity of the county. “These aren’t just words, this is the voice of my heart and InshaAllah we will be able to achieve all these targets,” he maintained.

IMF programme to fianlise soon

Regarding the International Monetary Fund (IMF) programme, he said: “If the IMF doesn’t put forward any other conditions, I am hopeful that we will be able to reach a staff-level agreement with them soon.”

He further added that the coalition government has taken some “daring” decisions after mutual consultations to provide relief to the people; however, the premier admitted the nation will witness difficulties in the short-run.

“We will steer out of the economic crisis because of these decisions and step onto the path envisioned by Quaid-e-Azam,” he said, adding that after coming into power, the coalition government had two options; to call elections afresh or to protect the “devastating economy” of the country by taking some tough decisions.

“The first way out was easy; however, our [coalition government] conscience did not allow us to do something which would impact the country as the time was to protect the state and not politics,” he stated.

The prime minister urged the affluent sections of society to come forward and share the burden.

He said that this is the first budget in the history of Pakistan in which the government has provided an “economic vision”.

Details of ‘tough decisions’

Announcing the imposition of a 10% super tax on cement, steel, sugar, oil and gas, fertiliser, banking, textile, chemical, beverage, and automobile industries, he said it has been done to save the common man from taxes.

“A 1% tax has been imposed on people earning over Rs150 million, 2% on those earning over Rs200 million, 3% on those earning over Rs250 million and 4% on those earning over Rs300 million,” he announced.


Here’s a list of 13 sectors on which 10% super tax will be imposed: 

  • Cement
  • Steel
  • Banking
  • Airlines
  • Textile
  • Automobile assembling
  • Sugar mills
  • Beverages
  • Oil and gas
  • Fertiliser
  • Cigarettes
  • Chemicals
  • LNG terminals

Industry facing crippling costs: Hammad Azhar

Reacting to the PM Shehbaz’s address, former energy minister Hammad Azhar said that the “super tax will be priced in their balance sheets and passed on to consumers” in many ways.

He said that while the country’s industry is already hit by price hikes, the public will now be more affected faction.

“Industry is already facing crippling costs due to rising prices of commodities and energy. This super tax will be priced in their balance sheets and passed on to the customers in many cases. Means even higher prices for the public,” Azhar wrote.

“Super tax will end up further squeezing the formal sector of the economy. This means taxing the already taxed even more. The economy is nosediving and such a measure at this time will reverse the industrialisation momentum that PTI generated,” he added.

Imran Khan increased tax collection: Shahbaz Gill

Meanwhile, PTI leader Shahbaz Gill criticised the incumbent coalition government for its decision to impose a 10% super tax on industries, listing down some of its consequences: rising unemployment, the decline in growth, 10% further increase in prices and an intensifying inflation storm.

He said that former prime minister Imran Khan increased the record of tax collection instead of taking such “cruel measures”.

Business

Changes in the US dollar’s value are directly correlated with variations in gold prices.

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The price of 24-karat gold in Pakistan increased by Rs1500 on Thursday, reaching Rs231,000 per tola. This was another jump in the price of gold in the country.

Dealers reported a comparable surge in the price of 10 grams of 24-karat gold, which is currently trading at Rs198,045 after rising by Rs1285. In addition, the cost of ten grams of 22-karat gold increased significantly, trading at Rs 181,541.

These fluctuations are strongly correlated with shifts in the US dollar’s value, demonstrating the tight connection between gold prices and exchange rates. This emphasizes how local gold markets are impacted by variables related to the global economy.

At Rs2,580, the price of 24-karat silver remains steady right now. The price of gold increased significantly on a global scale as well, rising by $14 to $2,214 per ounce.

It’s critical to understand that changes in the worldwide market can have a substantial impact on gold prices in Pakistan throughout the day. The gold rates that are offered are obtained from reliable sources, mostly situated in Karachi and Multan.

It is recommended that individuals seek the advice of nearby gold merchants and jewellers for the most precise and current information regarding gold prices.

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Pakistan pledged to finish building the TAPI gas pipeline.

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The minister discussed the importance of the TAPI gas pipeline project for Pakistan’s energy needs during a meeting with Turkmenistan’s ambassador to Pakistan, Atadjan Movlamov.

The Minister was congratulated by Ambassador Movlamov on taking office and his commitment to the project was noted.

Dr. Musadik Malik thanked the ambassador for his kind words, acknowledged the support, and promised to maintain the two nations’ friendship. The intergovernmental commission and working group meetings for the project this year were briefed by Atadjan Movlamov.

He invited the Minister to attend the Turkmenistan Energy Forum, which would take place in Paris the following month.

TAPI undertaking
The project is for the construction of a 1,680-kilometer pipeline with a 56-inch diameter that can carry 3.2 billion cubic feet of gas per day (bcfd) from Turkmenistan through Afghanistan and Pakistan to the border between Pakistan and India.

According to the terms of the TAPI agreement, Afghanistan would receive its portion of 0.5 billion cubic feet of gas per day, while Pakistan and India will each receive 1.325 billion cubic feet of gas per day.

In order to carry out the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project, Pakistan and Turkmenistan inked a cooperative implementation plan in Islamabad on June 4.

Prime Minister Shehbaz Sharif and a delegation from Turkmenistan, led by Minister of Energy and Water Resources Daler Juma’a, were present at the ceremony.

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The price of gold is still rising in Pakistan.

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According to the All Sindh Sarafa Jewellers Association, the cost of 10 grams of 24 karat gold grew by Rs. 86 to Rs. 196,760 from Rs. 196,674, while the cost of 10 grams of 22 carat gold jumped to Rs. 180,363 from Rs. 180,284.

The price of silver per tola and ten grams stayed at Rs. 2,211.93 and Rs. 2,580, respectively.

According to the Association, the price of gold on the global market rose by $7 to $2,200 from $.2,193.

It is important to note that Pakistani and IMF personnel have agreed at the staff level on the second and final review conducted as part of Pakistan’s Stand-By arrangement.

The International Monetary Fund (IMF) and Pakistan have reached a staff-level agreement on the second and final review of Pakistan’s stabilization program, which is supported by the IMF’s US$3 billion (SDR2,250 million) SBA Agreement. This is according to the official statement released by a team led by Nathan Porter.

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