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I PUT MY TRUST IN ALLAH: “ALLAH IS SUFFICIENT FOR US” (Quran 3:173)

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FIS

CA

L

PO

LIC

Y

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WORK AGENDA

1. INTRO (Fiscal Policy, Bill)

2. TYPES & OBJECTIVES

3. GOVT (Receipts, Expense & Deficit)

4. STRUCTURE (Raising Fund)

5. CONSOLIDATED FUND

6. PROBLEMS: RELATED PAKISTAN

7. REMEDIES

8. CONCLUSIONS

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INTRODUCTION

FISCAL POLICY: “ Fiscal Policy considers:

1. Imposition of taxes

2. Govt. Expense

3. Public Debt”

CONTITUTIONAL “In Federal list Article 142:

FRAME WORK: 1. Currency

2. Public Debt

3. Finance & A/c”

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INTRODUCTION

FINANCE BILL: Govt Proposal for:

1. New Taxes

2. Alterations

3. Finance Act

4. Majors: Income, Sales,

Customs ETC

5. Foreign Trade

6. Loans & Grants

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TYPES OF FISCAL POLICY

1) EXPANSIONARY:

• Increase in Govt Purchases• Decrease in Govt Taxes

2 TYPES:2) CONTRACTIONARY:

• Decrease in Govt Purchases• Increase in Govt Taxes

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OBJECTIVES OF FISCAL POLICY

1) Self Reliance

2) Expansion of Exports

3) Stop Import of Luxury Goods

4) Promotion of Investment

5) Public Finance Distribution (NFC)

MAJOROBJECTIVES

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GOVT RECEIPTS, EXPENSE & DEFICIT

RECEIPTS:

1) REVENUE RECEIPTS ( Tax & Non Tax)

2) CAPITAL RECEIPTS

3) EXTERNAL RECEIPTS (Consortium & Non Consortium)

4) SELF FINANCING (Autonomous Bodies)

EXPENSES:

1) CURRENT EXPENDITURE

2) DEVELOPMENT EXPENDITURE (Defence, Social Service, Grants, Subsidies ETC)

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GOVT RECEIPTS, EXPENSE & DEFICIT

DEFICIT FINANCING:

1) PRINTING NEW CURRENCY

2) PUBLIC BORROWINGS

3) FOREIGN LOANS, AIDS, GRANTS

4) USING PREVIOUS BALANCES

5)BORROWING FROM BANKS

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STRUCTURE OF RAISING FUNDS

STRUCTURE:

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CONSOLIDATED FUND

CONSOLIDATE

D FUND:

ARTICLE 78,81 & 121:

"one fund into which shall flow every stream of public revenue and from which shall come the supply of every service“

PARTS:

• FEDERAL & PROVINCIAL

• PUBLIC ACCOUNTS

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PROBLEMS IN PAKISTAN

TAX EVASIONS:

1) Complex structure

2) No punishment

3) Do not disclose true income

4) Exempted Sectors

5) Personal interest of High class

6) Narrow Tax Base

7) Heavy tax on Manufacturers

8) Avoid Value Added Items

9) Increased non Development Expense

10)Unfair tax structure

REVENUE & EXPENSE GAP:

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PROBLEMS IN PAKISTAN

BUDGETARY SHORTFALLS:

1) Power Shortage

2) Industrial Crisis

3) Tax Evasion by well performing Industries

4) Stock Exchange pays minimal tax

5) Corruption by tax officials

6) Real State business pays minimal tax

7) Law and Order Causing Burden

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REMEDIES OR RECOMMENDATIONS

Remedial Measures:

1) FBR should impose new taxes

2) Increase price of utility

3) Decrease in development expending

4) Measures for natural disasters

5) Balance between defence & federal budget

6) Increase in tax base

7) Law and order conditions

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CONCLUSIONSREVENUES

CONCLUSIONS:

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CONCLUSIONSEXPENDITURES

CONCLUSIONS: