KP rejects Centre’s proposal to deduct Rs6.4bn from federal transfers

The Khyber Pakhtunkhwa (KP) government has rejected a federal proposal to deduct Rs6.4 billion from federal transfers payable to the provinces. On August 5, the Finance Ministry informed the Accountant General of Pakistan Revenues (AGPR) in Peshawar about the proposed at-source deduction, with the amount to be adjustable in the accounts for FY 2026-27.

However, the KP Finance Department responded on Thursday, stating that the MoU circulated by the federal government for this purpose has not been approved by the provincial cabinet or signed by the provincial government. KP also emphasized that Article 164 of the Constitution does not authorize unilateral deductions from funds constitutionally payable to a province.

Chief Minister Sohail Afridi had previously mentioned that the federal government had demanded additional funds from KP, just like other provinces, with conditions that included a meeting with Imran Khan and the merged districts receiving their constitutional share under the 11th National Finance Commission.

Brief written by urgent.news from Dawn's own syndicated text. Machine-written — may contain errors; check the original before relying on it.