The Sindh Assembly on 25-June-2025 passed the provincial budget for the fiscal year 2025-26. The budget had earlier been presented by Chief Minister Syed Murad Ali Shah with a total outlay of Rs3,450 billion, marking a 12.9 percent increase compared to the budget of the outgoing financial year.
The removal or withdrawal of six levies, especially the professional tax, will benefit the people of Sindh, with the latter providing a Rs5 billion relief. According to the government, the budget emphasises social protection, infrastructure development, economic reforms and comprehensive relief measures for the underprivileged.
The assembly members discussed expenditures charged to the provincial consolidation fund and reviewed and voted on demands for grants on supplementary statements for the year 2024-25.
There were a total of 188 demands, against which the opposition moved 2002 cut motions, which were rejected by a majority vote; most of the cut motions were grouped together and rejected. The assembly passed demands for grants for the year 2025-26 after discussion and voting.
The CM had presented the Sindh Finance Bill 2025 in the House to rationalise levies and certain taxes and duties and to amend relevant laws. It was said that the government was introducing blockchain-based land record digitisation, online mobile-based birth registrations and credit access for farmers via the Sindh Cooperative Bank. A one-step land ownership transfer system was also being launched.
The budget provides Rs43 billion for a new ad-hoc relief allowance and Rs16 billion for a 15 percent increase in pensions. The CM announced removal of six levies from the upcoming financial year 2025-26. The professional tax, which affects salaried people and small businesses, has been withdrawn. This alone is a Rs5 billion relief for the salaried people and businessmen, particularly the smaller ones.
The entertainment duty had also been withdrawn, which will help encourage cultural and entertainment activities across the province. Other tax relief measures are 50 per cent reduction in fees for mutation, sales certificates, certified copies, solvency and heirship certificates, and capping of yearly commercial vehicle tax at Rs1,000.
Significant grants have been earmarked for critical institutions with Rs42.2 billion allocated for public sector universities, Rs 10.4 billion for medical education, Rs5 billion for an inclusive city for persons with disabilities, Rs6.6 billion for the Sindh Institute of Child Health and Neonatology, and Rs5.2 billion for emergency ambulance services.
The CM, who also holds the finance portfolio, had highlighted key macroeconomic indicators while unveiling the budget. Pakistan’s national GDP growth target for 2025-26 had been set at 4.2pc, up from the actual 2.68 per cent recorded in 2024-25. Inflation rate was targeted at 7.5pc, compared to 4.7pc this year, he said.
The total expenditure includes Rs2,150 billion under current revenue expenditure (CRE), constituting 62 per cent of the total outlay. This covers salaries, pensions, grants, operations and maintenance. Development expenditure, which accounts for 30 percent of the budget, stands at Rs1,018.3 billion and includes the Annual Development Programme (ADP), foreign-assisted projects and district development allocations. Capital expenditure amounts to Rs281.7 billion, covering loan repayments, viability gap funding and investments.
Within the CRE, 39 percent has been earmarked for salaries, 29 percent for grants, including those for local bodies and autonomous institutions, 19 pc for non-salary operating costs and maintenance, and 13 percent for pensions.
Despite previous fiscal challenges and revenue shortfalls, with a -3.6 per cent shortfall against budgeted estimates in FY 2024-25, the provincial government expects a significant financial recovery. For FY 2025-26, total receipts are projected at Rs3,111.5 billion, marking a 21.4pc increase from the revised estimate of Rs2,562.7 billion. Over the next three years, Sindh anticipates an annual average revenue growth rate of 12.5pc.
If the FBR achieves its revised target of Rs11.7 trillion by June 2025, Sindh expects a share of around Rs 269 billion in the federal divisible pool taxes.
The provincial ADP is a key highlight within the Rs1.018 trillion development spending with Rs8 billion allocated for the Benazir Hari Card scheme and Rs1.8 billion for livestock breeding. Schemes have also been included for the introduction of solar tube wells, drip irrigation systems, and super seeders at subsidised rates.
Rs2 billion has been allocated for low-income housing initiatives, Rs2 billion for the Sindh People’s Support Programme, Rs200 million for orphan and widow support, Rs500 million for women agriculture workers, and Rs500 million for small and medium enterprises development.
In health schemes, a Sindh Institute of Urology and Transplant (SIUT) centre will be established at Larkana for Rs4.5 billion. Rs21 billion has been earmarked for the SIUT, Rs23 billion for the National Institute of Cardiovascular Diseases, Rs16.5 billion for public-private health initiatives, and Rs10 billion for a new hospital in Larkana.
The education projects include school-specific budgets, expanded stipends for persons with disabilities and doubling of assistive devices from 20,000 to 40,000. The Sindh government also plans to make operational 27 youth development centres across the province.
Rs10 billion has been allocated for Dumlottee-DHA water pipeline and Rs 3.1 billion for the Hub Canal. Rs25 billion block has been allocated for green energy and Rs45 billion for Sustainable Development Goals-linked public health initiatives.
Published in News Daily on 26 June 2025.