PESHAWAR: The Khyber Pakhtunkhwa government has rejected a federal proposal to deduct Rs6.4 billion at source from the province’s July financial transfers, Chief Minister Sohail Afridi said on Saturday.
The chief minister said the federal Ministry of Finance had proposed the deduction on August 5, but the provincial government neither approved nor agreed to the proposed arrangement.
CM Afridi said the federal government had sought additional funds from KP, as it had from other provinces, before the federal budget. He said he had made the provision of the additional funds conditional on a meeting with PTI founder Imran Khan, who is at Adiala Jail, and obtaining his approval.
CM Afridi said the provincial government did not approve or sign the memorandum of understanding (MoU) concerning the additional funds because a meeting with the PTI founder was not facilitated.
He said the Ministry of Finance proposed deducting Rs6.4 billion from the federal transfers due to KP for July. The provincial Finance Department formally conveyed its disagreement with the proposed deduction in a letter dated August 13, he added.
CM Afridi said no funds had been allocated for the proposed arrangement in the Khyber Pakhtunkhwa budget for fiscal year 2026-27. He said that if the Federal Board of Revenue (FBR) achieved its Rs15.26 trillion revenue target, KP’s share would have been around Rs175 billion.
The chief minister described the dispute as a matter of the province’s constitutional and financial rights rather than merely a political disagreement. “KP will not accept this unconstitutional move,” CM Afridi said, adding that the provincial government would use every legal, constitutional and institutional avenue to protect its rights.
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