ISLAMABAD, June 13 (Alliance News): Finance Minister Mohammad Aurangzeb announced that Pakistan aims to secure $2 billion from commercial lending markets this month, in a bid to elevate foreign exchange reserves to $14 billion.
Speaking to the National Assembly’s Standing Committee on Finance, Aurangzeb revealed that half of the targeted amount will be guaranteed by the Asian Development Bank (ADB) and the Asian Infrastructure Investment Bank (AIIB).
He also expressed optimism about a potential interest rate cut by the State Bank of Pakistan in the upcoming monetary policy meeting, noting that inflation is expected to drop to single digits in the next fiscal year.
The minister further stated that the government would initiate downsizing and rightsizing of state-owned enterprises, particularly Utility Stores Corporation and Passco.
Federal Secretary Finance Imdadullah Bosal informed the committee that a 10% salary increase for all public sector employees has been approved, along with a Special Relief Allowance — 50% for Armed Forces officers and 20% for Junior Commissioned Officers and soldiers — in the FY 2025-26 budget.
Originally, a 6% raise was proposed but later increased by the cabinet during budget finalization.
Minister of State for Finance Bilal Azhar Kiyani, who assumed responsibilities following a brief post-budget press conference boycott by journalists, also attended the committee session chaired by Syed Naveed Qamar.
The committee was briefed on multiple relief measures: a 7% pension hike, a 30% Disparity Reduction Allowance, and new taxation adjustments.
The Federal Board of Revenue (FBR) proposed a tax rate cut for the first income slab (Rs600,000–Rs1.2 million) from 5% to 1% in the initial Finance Bill 2025-26. However, following the salary hike, the tax rate for this slab was revised to 2.5%, raising the annual tax from Rs6,000 to Rs15,000.
FBR also confirmed that for all higher income slabs, an additional Rs9,000 would be charged, while maintaining previously proposed tax rates.
Opposition Leader Omar Ayub criticized the government over massive Iranian oil smuggling, which he said cost the country Rs500 billion — including Rs149 billion in petroleum levy losses.
He questioned the customs department’s failure to act and opposed proposed arrest powers for FBR officers under the new finance bill.
Bosal clarified that the petroleum levy currently stands at Rs77–78 per litre, with an additional Rs2.5 carbon levy, totaling nearly Rs80 per litre — with no upper limit.
The government also introduced an Electric Vehicle (EV) Adoption Levy on both local and imported EVs, aiming to raise Rs10 billion in revenue.
