Punjab Government Unveils Rs5.3 Trillion Tax-Free Budget for FY2025-26 with Record Development Outlay
Lahore – June 16, 2025:
Punjab Finance Minister Mujtaba Shuja-ur-Rehman on Monday presented a Rs5.335 trillion tax-free budget for the fiscal year 2025-26, marking a significant step towards development-focused governance. The budget was presented in the Punjab Assembly, just a week after the federal government’s budget announcement.
Key Budget Highlights:
- Total Budget Outlay: Rs5.335 trillion
- Non-Development Expenditure: Rs2.706 trillion (+6%)
- Current Capital Expenditure: Rs590 billion
- Development Budget: Rs1.24 trillion — a record-high, up 47% from FY25
- Federal Transfers (FDP): Rs4,062.2 billion
- Provincial Revenue Target: Rs828.1 billion
- Punjab Revenue Authority (PRA) Target: Rs340 billion
Focus on Social Services
The budget allocates Rs494 billion to the social sector, accounting for 40% of the development budget. The provincial government announced a 10% salary increase for government employees and a 5% pension raise.
Education Sector Boost
- Development Expenditure: Rs148 billion
- Non-Development Expenditure: Rs661 billion
- Laptop Scheme: Rs15.1 billion for 112,000 students
- School Uplift: Rs40 billion
- Merit Scholarship Programme: Rs15 billion
- Higher Education: Rs25 billion
- Special Education: Rs5 billion
Health Sector: Major Investment
- Total Health Budget: Rs630.5 billion
- Development Expenditure: Rs181 billion (+131%)
- Non-Development Expenditure: Rs450 billion
- Free Medicines: Rs79.5 billion
- Nawaz Sharif Medical District (Lahore): Rs109 billion
- Nawaz Sharif Institute of Cancer Treatment and Research: Rs72 billion
Support for Local Bodies & Infrastructure
- Local Government Bodies: Rs411.1 billion
- Waste Management & Municipal Grants: Rs150 billion + Rs20 billion
- Construction Sector: Rs335.5 billion
Agriculture and Social Protection
- Agriculture, Livestock & Irrigation Development: Rs123 billion
- Non-Development (Agri Sector): Rs56.2 billion
- Social Security Package: Rs70 billion
The finance minister lauded both political and military leadership for maintaining national interests and mentioned that 6,104 development projects were completed during the current fiscal year.
Opposition Reaction
The budget session saw protests from opposition lawmakers of Pakistan Tehreek-e-Insaf (PTI), highlighting political tensions amid the provincial government’s presentation.
No New Taxes Introduced
Staying true to its “tax-free” label, the provincial government introduced no new taxes in the budget. Instead, the focus remains on efficient revenue collection, increased development expenditure, and expanding public welfare programs.
Strategic Focus
Calling it a “strategic shift in Punjab’s history,” the finance minister emphasized infrastructure, health, education, and sanitation as core priorities. The budget outlines over 850 development schemes, including public-private partnerships for new hospitals under the expansion of Nawaz Sharif Medical City.
With an estimated Rs740 billion in provincial surplus aligned with IMF commitments, Punjab’s FY2025-26 budget aims to drive inclusive growth, improve public service delivery, and boost socio-economic development across the province.
