Salaries of Government Employees to increase @ 15%

Federal Cabinet has approved the increase in Salaries of Government Employees @ 15 percent ahead of budget seminar held at National Assembly today. 5 percent increase in pension of government employees were also approved. The federal government has already approved 10 percent increase in pension during April this year.

According to details of budget for FY23 total volume of budget is about 9500 billion rupees in which 7255 billions will be collected through FBR from direct tax. Rs. 3523 billions are allocated for loan repayments. 1586 billion is allocated for defence estimates.

Relief Measures for Employees

• The Adhoc relief allowances 2016, 17,18, 19 and 21 will be merged in the basic pay scales 2017 with effect from 1st July 2017 thus introducing new pay scale i.e. BPS 2022
• Grant of 15% adhoc relief allowance on the running basic pay of BPS-2017 to all federal government employees
• Conveyance allowance will be enhanced by 100%
• Disparity reduction allowance 2022 @ 15% (already provided to BPS 1-19 in Mar 2022) will be extended to the officers in BPS 20 – 22 on the existing terms and conditions
• The existing rates of drivers salary embedded in Transport Monetization will be enhanced to Rs. 25000
• Orderly allowance will be increased from 17,500 to Rs. 25,000
• Entertainment allowance will be abolished

Key budgetary proposals

• Minimum tax bracket for small business persons to be raised from Rs0.4 million to Rs 0.6m
• Minimal taxable income limit will be raised from Rs 0.6m to Rs 1.2m per year on salaried class
• 15pc increase in salaries of government employees
• One lac laptops will be distributed in students on easy installments
• Sales tax exemption on import of solar panels and distribution
• Govt loan scheme for below 200 unit consumers to purchase solar panels
• Advance withholding tax will be collected from those sending remittances abroad via credit, debit and pre-paid cards
• Advance tax will be increased on cars above 1600cc
• Exemption of complete custom duty on pharmaceutical ingredients
• Rs51bn proposed for education projects
• Rs24bn for health sector
• Agricultural machinery will be duty free

Due to the inflation, households earning less than Rs40,000 will be compensated by the government in addition to a significant increase in the funding for Benazir Income Support Program (BISP). BISP scholarship is being extended to 10 million students.