MUZAFFARABAD: The Azad Jammu and Kashmir (AJK) administration accused the Shehbaz Sharif-led federal government on Monday of reducing its development funding and share of federal taxes, threatening its development and other plans for the current and future fiscal years.
AJK Finance and Inland Revenue Minister Abdul Majid Khan made the claim during a news conference in the PM House, according to AFP.
Chaudhry Mohammad Rasheed, Chaudhry Akbar Ibrahim, the minister of civil respect and disaster management, as well as special assistant Rafique Nayyar, were among those accompanying him.
This fiscal year, AJK’s development budget was Rs28 billion from the federal government, however, it was reduced by Rs5.2 billion by the federal finance division alone.
For this fiscal year (2021-22), the federal government was supposed to send Rs49.9bn to AJK for its 3.64pc share of federal taxes (variable grant), but that too had been lowered by Rs4.4bn, he added.
In 2018, Islamabad and Muzaffarabad came to an agreement on a 3.64 percent share of the federal tax pool, which he claimed was an important source of AJK money for its recurrent budget.
A 3.64 percent increase in FY 2022-23 would amount to Rs74.32 billion, according to the AJK financial department. However, the federal government just announced that it will only contribute Rs60 billion.
Pakistan’s AJK minister warned that if they do not reconsider the decision, the country’s financial system might be irreparably damaged.
“This would cause a gap of Rs14bn in our revenue that we cannot bridge from any other source,” he added.
“For the first time in AJK’s history, the federal government would decrease our regular [recurring] budget,” he said.
He remarked right away that AJK’s development budget was in the dark about how much money it would get.
However, AJK’s federal minister said that even though 40 percent of the LoC package’s work had already been completed, but now federal money had been cut off.
There was a meeting of provincial and AJK treasury officials on May 13 that was postponed without notice, said Mr Ismail in an interview.
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