The net federal transfer to the provinces from divisible pool on account of taxes has been revised downward to Rs 1,996.264 billion from budgeted Rs 2,044.143 billion, reflecting a shortfall of Rs 48 billion. According to revised estimates for fiscal year 2016-17, net federal transfer to the provinces was revised downward to Rs 2,238 billion for the current fiscal year from budgeted Rs 2,270 billion largely due to lower tax collection in the divisible pool.

An official said as the Federal Board of Revenue (FBR) tax collection was less than the budgeted target, provinces' share from divisible pool was also decreased. However, there was a significant increase of straight transfers to the provinces of Rs 125 billion against Rs 91 billion budgeted for the current fiscal year and programme loans to Rs 15.92 billion from Rs 8.27 billion.

Special grants/subventions to the provinces have been revised downward to Rs 23 billion from budgeted Rs 40 billion for the current fiscal year and project loans and grants to Rs 77 billion from budgeted Rs 86 billion. Japanese grant was budgeted at Rs 52 million for the current fiscal year, which has now been revised downward to Rs 1 million. The provinces' share in federal taxes and straight transfer was estimated for the current fiscal year in accordance with the framework for distribution of resources structured by the seventh National Finance Commission Award (NFC).

Copyright Business Recorder, 2017