ISLAMABAD, Dec 5: The centre has transferred about Rs91 billion to the four provinces as their share in the federal revenue in the first quarter (July-Sept) of the current financial year, which amounts to less than 20 per cent of the year’s target of about Rs465 billion.

According to finance ministry’s statistics, Punjab was provided about Rs44.5 billion, accounting for less than 19 per cent of its annual projected share of Rs236 billion. Sindh got approximately Rs28 billion or 19.4 per cent of its annual share of Rs144 billion. The NWFP received Rs10.8 billion or about 19.3 per cent of its Rs55.9 billion share, while Balochistan was given about Rs7.7 billion or 26 per cent of its annual share of Rs29.6 billion.

The official data suggest the current expenditure during the July-Sept period stood at Rs340 billion, showing a higher rate of spending. If the pace remains the same, the full-year expenditure is likely to exceed Rs1,350 billion, almost 28 per cent more than the Rs1,056 billion target.

The federal budget for 2007-08 envisages Rs465 billion as share of provinces in federal revenue receipts, including Rs403 billion in net proceeds from the federal divisible pool under the interim National Finance Commission Award. This does not include project aid and subventions.

Under the award, the provincial share in net proceeds of the divisible pool has been fixed at 42.5 per cent in 2007-08 that would gradually increase by one per cent every year until 2010-11 and onwards. The straight transfers to provinces for the next year have been projected at Rs62.8 billion, compared to Rs70.3 billion during the current fiscal year, showing a decline of almost 11 per cent or Rs7.5 billion.

The provinces are entitled to get one-sixth of sales tax which would subsequently be transferred to district governments and cantonment boards in full. Under this head, Punjab’s share is 50 per cent, followed by Sindh’s 34.85 per cent, NWFP’s 9.93 per cent and Balochistan’s 5.22 per cent.

The remainder of the divisible pool is distributed among provinces on the basis of population. Under this head, Punjab is to get the highest share at 57.36 per cent, followed by Sindh 23.71 per cent, the NWFP 13.82 per cent and Balochistan 5.11 per cent.Moreover, Punjab, Sindh, the NWFP and Balochistan are also entitled to get 11 per cent, 21 per cent, 35 per cent and 33 per cent, respectively, out of Rs31 billion in collections from the provinces.

Under the 1997 NFC Award (Amendment) 2006, income tax, wealth tax, capital value tax, taxes on sales and purchase of goods, export duty on cotton, customs duty and federal excise duty, excluding the excise duty on gas charged at well-head, constituted the federal divisible pool.

The federal government deducts five per cent of collection charges for the divisible pool components before paying net provincial shares.