SINDH and Khyber Pakhtunkhwa (KP) presented their budgets for the financial year 2025-26 on Friday with focus on development and relief for different segments of the society.
The PPP Government in Sindh unveiled a Rs3,451.87 billion budget for the fiscal year 2025-2026 — representing a 12.9% increase compared to the previous year’s budget of Rs3,056.3 billion and a deficit of Rs38.458 billion.
While presenting the budget, Sindh Chief Minister Syed Murad Ali Shah, who also holds the portfolio of Provincial Finance Minister, proudly announced that they were introducing a finance bill to abolish and decrease some taxes/levies/cess instead of increasing them.
The KP Government presented a Rs2.119 trillion surplus budget for the fiscal year 2025–26 in the provincial assembly, describing it as a historic step towards economic recovery after inheriting what it called a financially crippled province.
The province claimed the new budget not only reflects sound fiscal management but also addresses critical development, salary, pension and debt servicing needs despite significant financial constraints and unpaid dues from the federal government.
The budgets of the two provinces carry significance as these have governments different from the federation with a difference of approach to developmental issues and the need for relief for masses as well as various sectors of the economy.
This is reflective by the decision of the Sindh Government to announce slightly different rates of increase in salaries and pensions than the Federal Government and the highly appreciable move of the KP Government to increase the minimum wage limit from the existing Rs 36,000 to 40,000 a month, an issue not touched by the Federal Government in its budget for the next year.
It is encouraging that the province has also announced incentives for the real estate sector that will surely help boost construction activities and facilitate people in realizing their dream of owning a house.
Tax relief measures include reducing stamp duty and property transfer tax from two per cent to one per cent, offering exemptions on taxes for properties up to 4.9 marlas and lowering the hotel bed tax from 10 per cent to seven per cent.
Professional tax has been abolished for individuals earning up to Rs 36,000 per month.
Additionally, the registration fee and token tax on electric vehicles have been waived.
The KP Government followed the footsteps of the Federal Government, which announced just 10% hike in salaries and 7% in pensions but proposed aligning the salaries of police personnel in KP with those of the Punjab Police.
The Shuhada (martyrs) package for police officials — from constables to inspectors — is proposed to be increased from Rs10 million to Rs11 million.
Disparity in salaries was a source of deprivation among security personnel in KP, who are facing constant threats to their lives due to a surge in terrorist activities and the decision of the provincial government will boost their sagging morale.
The KP Government also deserves credit for making efforts to increase provincial revenues without imposition of any new tax.
As For Sindh, the PPP is regarded as a pro-employees party and in the past it offered generous pay raises.
This time round as well it gave more benefits to employees and pensioners by hiking salaries by 12% for government employees from grade one to sixteen and 10% for others.
Pensions have also been increased by 8% as compared to 7% by the Federal Government, making, however, not much difference for senior citizens.
Other highlights of the provincial budget include increased allocations for education, health, infrastructure, and social welfare, along with strategic initiatives to modernize governance and stimulate economic growth.
In a move that is likely to empower school managements, education related funds will be directly disbursed to schools, improving transparency and obviating chances of misappropriation at the higher levels.
The budget also envisages allocation of Rs.20 billion for Pro-Poor Social Protection and Economic Sustainability Initiatives, highlighting the government’s focus on inclusive growth.
