Government account: KP PAC discusses Rs36bn financial irregularities
PESHAWAR: Khyber Pakhtunkhwa Public Accounts Committee has discussed Rs36b financial irregularities from the government account.
According to details, the meeting of the KP PAC committee was chaired by provincial assembly Speaker and Committee Chairman Babar Saleem Swati, which focused on suspected financial irregularities involving Rs. 36 billion in transactions from a government account in District Kohistan.
Terming it the most serious financial scandal in the province's history, Speaker Babar Saleem Swati expressed strong displeasure with the concerned departments — the Finance Department, Communication and Works (C&W), and the Office of the Accountant General. He directed them to submit a detailed inquiry report within three days. He further warned that if the internal inquiry proved unsatisfactory, an independent third-party audit would be commissioned and criminal proceedings would be initiated.
Accountant General of KP, Nasruddin, informed the committee that between 2016 and 2024, Rs. 181 billion were deposited into and Rs. 206 billion withdrawn from the said account, resulting in an unexplained shortfall of Rs. 24 billion. He explained that these accounts are nominally under the Finance Department but are practically overseen by district accounts officers under the AG's Office.
Director NAB KP, Shafqat Mehmood, apprised the meeting that NAB has already initiated an inquiry into the matter, and all relevant documents, bank records, and official files have been requisitioned. He assured the committee that it would be kept informed as the investigation progresses.
MPAs Sajjadullah, Arbab Usman, and Ahmad Karim Kundi expressed serious concerns during the meeting, stating that the lack of transparency in the allocation and utilization of development funds undermines public trust.
Advisor to the Finance Department, Muzzammil Aslam, informed the committee that between 2019 and 2024, Rs. 594 billion was released for development projects, including Rs. 125 billion for road infrastructure. He clarified that the account in question was directly managed by the C&W Department, and the Finance Department had no direct oversight over it.
Copyright Business Recorder, 2025
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
11 hours ago
- Business Recorder
KSE-100 settles at new record high as PSX reacts positively to budget
Investors at the Pakistan Stock Exchange (PSX) rejoiced over the lack of major taxation measures proposed during the budget for fiscal year 2025-26, as the benchmark KSE-100 Index settled at a new record high of 124,352.68 on Wednesday. Bullish momentum persisted throughout the trading session, pushing the KSE-100 to an intra-day high of 124,588.17. At close, the benchmark index settled at 124,352.68, amid an increase of 2,328.24 points or 1.91%. Across-the-board buying momentum was observed in key sectors including automobile assemblers, cement, commercial banks, oil and gas exploration companies, OMCs and power generation. Index-heavy stocks including HUBCO, PSO, WAFI, MARI, OGDC, PPL, POL, HBL, MCB, MEBL and UBL settled in the green. The upswing at PSX comes as the government did not announce any 'major changes on taxation', said Samiullah Tariq, Head of Research at Pak Kuwait Investment Company Limited, told Business Recorder. 'Capital gain dividends are retained at 15%,' he added. In a statement, Prime Minister Shehbaz Sharif expressed satisfaction over the stock market performance. 'The bullish trend in the stock market is an expression of confidence by investors and businessmen in the people-friendly budget,' he said. Finance Minister Muhammad Aurangzeb presented the federal budget 2025-26 to the parliament on Tuesday, with a total outlay of Rs 17.573 trillion, targeting a GDP growth rate of 4.2 per cent against 2.7 per cent in the outgoing year. Aurangzeb termed the budget the start of a strategy to create a competitive economy and economic productivity to increase exports and fundamentally change the economy's DNA. The government has set an inflation target of 7.5% for the next fiscal year. Regarding the fiscal deficit, the government projected a target of 3.9% of the GDP — or Rs5,037 billion — from the outgoing fiscal year's target of 5.9%. The primary surplus is targeted at 2.4% of the GDP against the budgeted 2% in the current fiscal year, which has been revised to 2.2%. Internationally, share markets and the dollar on Wednesday offered a guarded welcome to the latest signs of progress in US-China trade talks, while awaiting more detail of what was decided and whether it would stick for long. Bond investors were also hunkered down for a reading in US inflation that could show the early impact of tariffs on prices, and a Treasury auction that will test demand for the debt. Over in London, negotiators from Washington and Beijing said they had 'agreed a framework on trade' that would be taken back to their leaders. US Commerce Secretary Howard Lutnick added the implementation plan should result in restrictions on rare earths and magnets being resolved, but again offered no specifics. The law was another hurdle as a federal appeals court allowed President Donald Trump's most sweeping tariffs to remain in effect on Tuesday while it reviews a lower court decision blocking them. Investors, who have been badly burned by trade turmoil before, offered a cautious response and MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.2%. Japan's Nikkei added 0.4% and Australian stocks firmed 0.4%.
Business Recorder
14 hours ago
- Business Recorder
Budget is ‘death knell' for IT industry: P@SHA
The budget has failed to address two urgent standing demands from the IT sector: a defined and fair taxation framework for remote workers, and the continuation and expansion of the current tax regime for formal IT exporters, according to the Pakistan Software Houses Association (P@SHA). In a statement on Wednesday, the association said the industry's repeated demand for a 10-year tax policy framework—one that allows companies to invest, grow and compete with global peers, has been ignored. It described this as a 'stunning act of neglect' and a 'quiet but decisive blow to an industry that has carried the hopes of export-led recovery, youth employment and digital transformation.' It added that for an industry that employs over 600,000 young Pakistanis and is one of the country's largest and most vital pools of skilled talent, 'this budget is not just a disappointment; it is a threat.' According to the association, high-earning remote workers employed by foreign companies, who are often indistinguishable from full-time employees, remain largely untaxed. Meanwhile, companies based in Pakistan, employing and training local talent, are taxed, audited and over-regulated. 'This makes local hiring more expensive; while incentivizing capital flight and informal arrangements.' It added that 'talent retention is collapsing; export dollars are being parked abroad, and formal firms are bleeding value.' Brain drain: Pakistan lost 727,381 workers to overseas employment in 2024 P@SHA said the government's refusal to act is particularly frustrating given the simplicity of its proposed solution: classifying any individual earning over Rs 2.5 million annually from fewer than three foreign sources as a remote worker. It believes this will affect only the top 5% of earners and avoids hurting freelancers and small remitters. It also said the government needs to extend the existing tax regime for exporters. It added that the $700 million in investment commitments secured through the Digital Foreign Direct Investment (DFDI) initiative is in jeopardy due to a lack of continuity in tax policy as 'foreign investors will not engage with a country where rules shift every year.' P@SHA said the budget 'is a signal to the world that Pakistan's digital economy is not ready to be taken seriously. The results will be devastating. Pakistan's IT sector—its fastest-growing, most globally competitive industry—may lose its momentum entirely.' It warned that export growth will stall; jobs will disappear and the government's dream of reaching $25 billion in IT exports will become permanently out of reach. It said the budget 2025, in its current form, is a direct threat to the survival of the formal tech ecosystem. It penalizes compliance; discourages investment and incentivizes informality. It warned that 'this is not about incentives anymore. It is about preserving one of Pakistan's only working economic success stories. The stakes could not be higher.' Pakistan's IT sector a bright spot The warning comes amid a report from i2i, which notes that Pakistan's IT sector has emerged as a bright spot in the country's otherwise sluggish economy, with exports set to reach around $3.7 billion (FY2025) and a predominantly young, tech-savvy population fueling growth. It said that in the first ten months of fiscal year 2025, IT exports reached $3.1 billion, marking a robust 21% year-on-year (YoY) increase. Notably, April 2025 saw monthly IT exports of $317 million, up 2% YoY, though down 7% month-on-month (MoM). This figure remains above the 12-month average of $314 million, reflecting the 19th consecutive month of YoY export growth starting from October 2023. Looking ahead, experts predict Pakistan's IT sector will continue its upward trajectory, expecting 10-15% growth in FY25, reaching $3.5–3.7 billion in exports. The government's ambitious 'Uraan Pakistan' economic plan targets $10 billion in IT exports by FY29, implying a compound annual growth rate (CAGR) of 28%. However, it warned that despite this momentum, structural issues remain. Freelancers, who contribute significantly to digital exports (projected to exceed $500 million in FY25), face hurdles such as limited access to international payment gateways like PayPal, unclear taxation, and a lack of tailored banking services. Moreover, the regulatory landscape around emerging fintech, including cryptocurrencies and digital assets, is still evolving.
Business Recorder
17 hours ago
- Business Recorder
Pakistan govt offers tax relief, cuts rates for salaried class
ISLAMABAD: The government has announced substantial tax relief measure in the federal budget (2025-26) for salaried class taxpayers, and reduced tax rates across all income slabs for salaried individuals, aiming to provide much-needed financial respite amid economic challenges. Tax rates for salaried individuals for income slab upto Rs.3,200,000 has been reduced to provide relief to lower and middle tiers income bracket. Similarly, surcharge rate is proposed to be reduced from 10% to 9% for salaried individuals only. The Finance Bill (2025-26) introduced a revised tax structure for salaried individuals, significantly lowering tax rates and amounts across various income brackets. Federal budget 2025-26: Cut in taxation rates for salaried people likely Income between Rs600,000 and Rs1.2 million: The tax rate has been set at 1%, with the tax liability on an income of Rs1.2 million reduced from Rs30,000 to Rs6,000. Income between Rs1.2 million and Rs2.2 million: The 15% tax rate imposed on annual income between Rs1.2 million and Rs2.2 million has been reduced by 4%. The new tax is set at 11%. This means, an employee earning up to Rs 2.2 million, who used to pay a maximum of Rs330,000 annually in tax, will now pay Rs242,000. Income between Rs2.2 million and Rs3.2 million: The tax rate has been lowered from 25% to 23%, providing relief to higher-earning salaried individuals. An employee earning up to Rs2.2 million, whose maximum tax was previously Rs550,000 per year, will now have Rs506,000 deducted annually. These reductions across all tax slabs reflect the government's commitment to supporting the salaried class, which has faced significant economic pressures due to inflation and rising living costs. When contacted, tax lawyer Waheed Shahzad Butt informed that salaried individuals, earning between Rs600,000 and Rs1.2 million annually, will get the largest relief as the Pakistan government proposed a one percent tax rate from the earlier five percent. The proposal means that individuals earning Rs1.2 million will pay Rs6,000 in taxes, down from Rs30,000. Additionally, the Pakistan government has proposed 11 percent income tax on taxpayers earning up to Rs2.2 million annually, a sharp four percent decline from the earlier 15 percent. Copyright Business Recorder, 2025
