Govt to unveil Rs17.5 trillion federal budget tomorrow

The federal government is expected to present a budget of around Rs17.5 trillion for the next fiscal year on Friday, with debt servicing, defence spending and provincial transfers projected to account for a major portion of expenditures.

Federal Minister for Parliamentary Affairs Tariq Fazal Chaudhry said the federal budget would be presented in the National Assembly at 3pm tomorrow, while the Senate would take up the budget later in the day.

In a statement posted on X, the minister said the budget would be laid before the Senate at 5pm following its presentation in the lower house of parliament.

Tariq Fazal said the government had prepared the budget while taking into account the country's economic situation and would provide maximum possible relief to the public.

"Keeping in view the prevailing economic conditions, all possible relief will be provided to the people in the budget," he said.

The minister said lawmakers belonging to the ruling Pakistan Muslim League-Nawaz (PML-N) and its allied parties would fully participate in the budget session.

According to budget estimates, approximately Rs7.8 trillion is likely to be allocated for interest payments on public debt, making it the largest expenditure item in the proposed budget.

The defence budget is expected to range between Rs2.9 trillion and Rs3 trillion, while around Rs1.1 trillion may be allocated for subsidies.

The government is also considering allocating Rs1 trillion for the Public Sector Development Programme (PSDP), while pension expenditures are projected at around Rs1.1 trillion.

Budget documents under consideration suggest that nearly Rs900 billion could be earmarked for the running of government affairs and administrative expenses.

More than Rs8 trillion is expected to be transferred to provinces under the National Finance Commission (NFC) award and other arrangements.

The government is also likely to allocate over Rs350 billion for emergency and contingency expenditures during the next financial year.

On the revenue side, the Federal Board of Revenue (FBR) is expected to be assigned a tax collection target exceeding Rs15 trillion.

The proposed target includes more than Rs7.4 trillion in direct taxes, over Rs4.7 trillion in sales tax collections, around Rs1.65 trillion in customs duties and more than Rs1 trillion in federal excise duties.

Non-tax revenue is projected to exceed Rs5 trillion, while the federation's net income is estimated at more than Rs11 trillion.

According to preliminary estimates, the overall budget deficit for the next fiscal year could remain around Rs3 trillion. After accounting for the expected provincial surplus, the federal government's budget deficit is projected to exceed Rs5.5 trillion.

The budget is expected to outline the government's fiscal strategy, revenue measures, development priorities and expenditure plans for the upcoming financial year amid efforts to maintain economic stability and meet commitments under ongoing reform programmes.

Reporter: Waqas Azeem