ECC extends Prime Minister’s Relief Package with Rs60 billion allocation

WEB DESK: The Economic Coordination Committee (ECC) of the Cabinet has approved the continuation of the Prime Minister’s Relief Package for the fiscal year 2024-25, along with the designation of the warehousing and logistics sector as an industry.

According to sources within the Finance Ministry, the ECC meeting, chaired by Finance Minister Muhammad Aurangzeb, reviewed a summary which outlined an allocation of Rs60 billion for the fiscal year 2024-25 under the Prime Minister’s Relief Package and the Ramazan Relief Package 2024.

The allocation includes Rs50 billion for the Prime Minister’s Relief Package and Rs10 billion specifically for the Ramazan Relief Package.

Since January 2020, the Utility Stores Corporation (USC) has been providing five essential items at subsidised rates under the Prime Minister’s Relief Package (PMRP). For the fiscal year 2023-24, the federal cabinet approved Rs35 billion for this targeted subsidy model, which was implemented by the USC until 30th June 2024.

The subsidies are aimed at providing relief to economically disadvantaged segments of society, identified through the Benazir Income Support Program (BISP). The five essential items are offered at reduced rates to BISP-registered beneficiaries.

Sources from the Ministry of Industries indicated that the current subsidy per household, set at Rs2,734 per month for the fiscal year 2023-24, is proposed to be increased to Rs3,650 per month for 2024-25.

This represents a rise of Rs916 per month, or 25.09 percent, in the overall subsidy per household.

The Ministry of Industries has requested that the Finance Division release funds on a monthly basis for the Prime Minister’s Relief Package 2024-25, covering a period of 10 months from 1st August 2024 to 30th June 2025, excluding the month of Ramazan.

The ministry has also sought approval to extend the Prime Minister’s Relief Package beyond 30th June 2024 until 31st July 2024 or until the approval of the proposed package under the existing targeted subsidy model.

Additionally, the ECC was requested to approve a turnover tax at the rate of 1.25 percent on the subsidy, to be collected by the Federal Board of Revenue (FBR) from the budgeted amount for the fiscal year 2024-25.