Balochistan unveils Rs1.089 trillion ‘tax-free budget’

QUETTA: Balochistan on Wednesday unveiled a Rs1.089 trillion ($3.92 billion) ‘tax-free budget’ for the fiscal year 2026-27, projecting a fiscal surplus driven by a steep rise in federal revenue transfers.

Presenting the financial budget in the provincial assembly, Balochistan Finance Minister Mir Shoaib Nosherwani said the province’s total estimated revenues stood at Rs1.134 trillion, with a surplus of Rs45.66 billion.

He said that no new taxes have been imposed and several existing levies have been slashed to stimulate economic activity in the province.

Nosherwani said that the surplus reflected rigorous financial discipline and strategic expenditure management across both development and non-development sectors.

Balochistan will continue to rely on its share of federal tax revenues under the National Finance Commission (NFC) Award, with federal transfers expected to remain the province’s primary source of income.

The provincial government has estimated federal transfers at Rs800.13 billion, accounting for the bulk of its revenues. It has set a target of Rs170.09 billion in own-source revenues through provincial tax and non-tax collections.

Foreign-funded projects are expected to contribute Rs65.34 billion, while project financing and capital receipts are projected at Rs68.75 billion.

The province also expects to carry forward a cash balance of Rs30.61 billion. To spur growth, the government has cut the Capital Value Tax (CVT) and stamp duty on property transfers from 2 per cent to 1 per cent, and declared a zero sales tax rate on educational services.

The finance minister said that Rs797.82 billion have been allocated for current or running expenditures.

He said that Rs206.61 billion have been allocated for the Public Sector Development Programme (PSDP). Additionally, Rs44.56 billion have been set aside for federally-funded development initiatives, while Rs40.38 billion will be spent on foreign-funded development projects.

Social Safety Nets and Employment

The finance minister announced a 7 per cent increase in salaries and pensions for provincial government employees.

The provincial government has allocated an additional Rs1.5 billion to the Balochistan Health Card programme to expand universal health insurance coverage.

It has earmarked Rs2.82 billion for the Balochistan Education Support Fund to assist underprivileged students, along with Rs54 million for the Shaheed Benazir Bhutto Scholarship Programme.

The government also plans to create 5,000 new public sector jobs across various departments to help reduce youth unemployment and introduce interest-free loan schemes aimed at promoting women’s economic empowerment.

The surplus budget comes at a critical juncture as Balochistan seeks to upgrade its security and transport infrastructure to support multinational investment, particularly around the deep-sea port of Gwadar.