FISCAL POLICY

DEFINITION

Government strategy of changing its tax collection and public consumption

Programs planned to accomplish its target".

TOOLS OF
FISCAL POLICY

GOVT GOVT
EARNINGS SPNDINGS

RAVINUE CAPITAL REVINUE CAPITAL

RECIEPT RECIEPT EXPENDITURE EXPENDITURE

TAX NON TAX

DIRECT INDIRECT
TAX TAX

 GOVT EARNINGS
 REVENUE RECIEPT CAPITAL RECIEPT

1 TAX Recovery of Govt loans

2 NON TAX Disinvestment of PSU

Fines and Penalties Market Borrowings

Fees

Profits of PSU

Govt Interest
 Grants and Gifts

GOVT EXPENDITURE
REVENUE EXPENDITURE CAPITAL EXPENDITURE

Interest Payments Expense on administration

Major Subsidies Repayment of Loans

Defense Loans to public enterprise

Sectorial development

FISCAL POLICY 2017 – 2019

A concise survey of financial execution during most recent
five years shows a deceleration in incomes and expansion in uses contrasted with
targets, making an expansion in the monetary shortfall 6.5 percent of GDP in
FY2018 - most elevated during the most recent five years. In FY2016, financial
shortfall was brought down to 4.6 percent of GDP however the low direction
couldn't be kept up and expanded to 5.8 percent and 6.5 percent during FY2017
and FY2018, separately. While, complete use development was contained at 10.1
percent in FY2018 when contrasted with 17.3 percent in FY2017. During initial
nine months of FY2019, merged monetary markers execution proposes that
complete income enlisted zero development over same period a year ago, while
absolute uses expanded by 8.7 percent for a similar period. Consequently,
monetary shortage as percent of GDP arrived at 5.0 percent as looked at 4.3
percent in practically identical time of a year ago. Financial pointers during
FY2018 propose that all out income at 15.1 percent of GDP stayed beneath the
overhauled focus of 16.0 percent. Both assessment and non-charge income
indicated inauspicious execution, while consumptions expanded. Duty income
arrived at 12.9 percent of GDP against the objective of 13.2 percent, of which FBR
charge assortment stayed at 11.1 percent against the amended objective of 11.4
percent. Likewise, non-charge income arrived at 2.2 percent against the objective
of 2.8 percent. Then again, complete consumptions remained at 21.6 percent
against the objective of 21.5 percent. Thus, financial deficiency outperformed its
overhauled focus of 5.5 percent and remained at 6.5 percent of GDP in the last
monetary year

decelerated, tumbling from 11.0 percent in FY2017 to 5.9 percent in FY2018,

because of a fall in non-charge income. Non-charge incomes posted a negative
development of 21.4 percent in FY2018 as contrasted and 23.0 percent positive
development in FY2017. The compression in non-charge income came
fundamentally from the decrease in protection related income, particularly CSF,
negative benefit of mailing station Dept./PTA and negative development in markup
and profits. As percent of GDP, non-charge income diminished to 2.2 percent in
FY2018 from 3.0 percent in FY2017. A few segments of non-charge income kept a
positive development rate, for example, SBP benefit with a development of 2.4
percent in FY2018. Additionally, eminences on oil and gas and bonus demand on
raw petroleum, which have moderately more modest offer altogether non-charge
income, likewise saw higher development during FY2018

Review of Public Expenditures :

In FY2018, absolute uses were 21.6 percent of GDP . Current consumptions in
FY2018 arrived at 16.9 percent, when contrasted with the long term normal of 16.3
percent, while, advancement uses kept up a lot of 4.7 percent of GDP, according to
the normal of the most recent five years. While by and large all out consumption
stayed high, development in all out uses decelerated to 10.1 percent during
FY2018 when contrasted with 17.3 percent in FY2017. This lull in consumptions
came fundamentally from lower development being developed uses and net
loaning which was diminished by 3.5 percent in FY2018 when contrasted with
developing by 27.9 percent in FY2017. The negative development to a great extent
came from negative development of 7.7 percent in PSDP uses during FY2018
against 33.1 percent development in FY2017. The speed of PSDP discharges
stayed delayed toward the finish of FY2018, particularly during the break
government period as Election Commission precluded beginning any new
advancement project, as this might actually impact citizen conclusions during the
decisions. Alternately, current consumptions developed from 10.7 percent in
FY2017 to 12.6 percent in FY2018.

Portion of protection consumptions altogether and current uses stayed at 13.8 and
17.6 percent, individually in FY2018 contrasted and 13.1 and 17.1 percent in the
former year. The spending gauges recommend that safeguard uses will stay at 2.9
percent of GDP during current financial year. Additionally, increase installments
posted a development of 11.2 percent in FY2018 to (4.3 percent of GDP)
contrasted with (4.2 percent of GDP) in FY2017, development of 6.7 percent.
Portion of increase installments altogether and current consumptions stayed at 20.0
and 25.6 percent, separately in FY2018 contrasted and 19.8 and 25.9 percent,
individually in FY2017. For FY2019, increases installments are planned at 4.2
percent of GDP. Current sponsorships posted a negative development of 25.7
percent in FY2018 as contrasted and negative development of 25.8 percent in
FY2017. Portion of sponsorships in current consumptions decreased from 3.0
percent in FY2017 to 2.0 percent in FY2018.
Essential deficit1 expanded from 1.6 percent of GDP in FY2017 to 2.2 percent of
GDP in FY2018. At the same time, income shortage expanded to 1.8 percent of
GDP in FY2018 contrasted with 0.8 percent in FY2017 because of wild current
uses.

or FY2019, all out income is assessed at 16.3 percent of GDP, of which charge
income target Rs 5,342.6 billion or 13.9 percent of GDP and non-duty income 2.4
percent of GDP. Complete uses at 21.2 percent of GDP with current consumptions
at 16.5 percent of GDP and improvement uses and net loaning assessed at 4.7
percent of GDP.The spending shortfall to be financed from both outer and
homegrown sources. Inside homegrown sources, bank and non-bank to contribute
65.6 and 34.4 percent, separately. Income shortfall and essential deficiency
planned at 0.2 and 0.7 percent of GDP, separately for FY2019.