2020-2021 Pakistan Budget

By Arooj Ahmed — Published on 14/06/2020

Federal Minister for Industries and Production Hammad Azhar presented the budget for the fiscal year 2020 to 2021 in National Assembly on Friday that aims to combat coronavirus pandemic and utilize the military sector when it is needed.


According to reports and analysis, the ruling government of Pakistan Tehreek-e-Insaf has allotted Rs 7,294.9 billion for the fiscal year. It is 11 percent less than the outlay of 2019. The ruling government allotted ₨. 7.022 trillion for 2019 to 2020, yet it has been estimated that that net revenue would increase to 6.7 percent in 2020 to 2021 as the government will manage to generate Rs 3,699.5 billion.

The major portion of the fiscal year budget has been allotted for defense with Rs 1.3 trillion- 12 percent more than budget of last year, while Rs 83 billion to education, Rs 80 billion special economic zones and Rs 70 billion for coronavirus.

Out of Rs 83 billion, Rs 70, 741 billion will be given for tertiary education. It is more than 84 percent of the total budget of education.

The current government has given Rs 230,907 million for social protection out of which, Rs 208 million will be spent on the sector only. It is 21.15 percent more than 2019-2020 budget of Pakistan.


The government of PTI has provided Rs 169,927 million for Public Order and Safety Affairs. Last year the budget provided Rs 153,269 million for safety affairs and public order.

The budget of Rs 1324 billion has been allocated for Public Sector Development Programme (PSDP) out of which Rs 676 billion is provided to provinces and Rs 650 million to the federal government.

Federal PSDP has divided Rs 650 million between federal ministers and their divisions, corporations, Earthquake Reconstruction and Rehabilitation Authority (ERRA), and coronavirus response and other natural calamities. It has allocated Rs 418.7 billion for feral division, Rs 100.4 billion for corporations, Rs 7 billion for COVID response and other natural calamities and Rs 3 billion for ERRA.

In General Public service, Rs 3,663,740 million has been allocated to legislative organs, executives, financials, external and fiscal affairs.

However, none of the new tax has been introduced in the recently announced budget. Due to COVID-19, the government has reduced the sales tax ratio to 12 percent from 14 percent to assist middle class and lower class.

Besides, there is reduction in tax in hotel industry from 1.5 to 0.5 percent. Moreover, the government has said that they will make an application where salaried class could submit their tax returns as it would increase tax income by 37 percent.

The budget has exempted sales tax from imported dietetic food. The exemption has been increased for three months further on the imported medical equipment.

However, the tax has been increased from 65 to 100 percent on imported cigarettes, tobacco, e-cigarettes and other types and subsides of tobacco.

Besides, there is an increment in tax on caffeine drinks and FDD to 25 percent from 13 percent to reduce the consumption of them.

The provinces will get Rs 2,873.7 billion from federal tax in the budget of this year. It is 11 percent less than the budget of 2019 to 2020.

2020-2021 budget is named as corona budget because it was presented during the pandemic and the money has been allocated to spend on the pandemic to triumph over it.

About Author

Written by
Arooj Ahmed is a content specialist interested in cutting-edge technologies and Pakistan's Updates. Arooj is committed to keeping up with the newest technological developments, especially as they pertain to the Pakistani market, despite her many years of expertise in the field. If you want to keep up with the ever-changing state of this profession, her knowledge and perspective are indispensable.

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