JHELUM: Finance Minister Shaukat Tarin said Friday that Saudi Arabia would provide a $3.6 billion facility for purchasing oil on deferred payments for a two-year period.
The finance minister was talking to media at the inaugural ceremony of the Track and Trace System of the Federal Board of Revenue (FBR) at the Pakistan Tobacco Company Jhelum.
Asked about the oil facility on deferred payment, he said that Saudi Arabia has agreed to provide $150 million cash on a monthly basis for providing oil facility on deferred payment basis.
Saudi Arabia will provide $3.6 billion in cash for two years to Pakistan for purchasing oil "from anywhere" for meeting its requirements.
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He added that Saudi Arabia's deal was done, under which they would provide a $150 million credit facility on a monthly basis, so it would be around $3.6 billion facility over the next two-year period.
The ceremony was also attended by Chairman FBR Dr Muhammad Ashfaq Ahmed along with Qaiser Iqbal, Member (IR Operations).
The CEO of Pakistan Tobacco Company Ali Khan welcomed the chief guest and other dignitaries present on the occasion.
The Federal Minister for Finance and Revenue in his speech congratulated the FBR for rolling out the project, which would help prevent leakage of revenue, under-reporting of production and sales of tobacco products, and ensure proper payment of FED and sales tax on the manufacture and sale of the products.
"TTS is a very comprehensive and robust electronic monitoring system, which is a paradigm shift from conventional physical monitoring system. It is believed that installation of the Track and Trace System (TTS) in the notified sectors would be a game changer for improving revenue and curbing counterfeit products in the market," the financed minister added.
While highlighting the persistent efforts of the FBR for rolling out the project, the finance minister stated that it was heartening to see that the FBR had successfully issued a license and subsequently, signed a contract with AJCL/Mittas/Authentix Consortium for installation of TTS on 5th March 2021.
This system is to be developed, operated and maintained by the licensees for notified sectors including tobacco products manufactured in and imported into Pakistan.
For this purpose, the FBR was striving to implement the system for the last 12 years, but unfortunately, it resulted in five unsuccessful attempts.
However, in its sixth attempt, the FBR has procured one of the best TTSs available after strenuous efforts of over a decade.
The finance minister further added that our prime objective was to take the tax-to-GDP ratio to 20 percent in the coming years, which currently stood at 8-12 percent.
He surmised that currently tax evasion of Rs70 billion was being committed in tobacco sector, which made 37 percent of market share.
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He added that with the use of technology, we would be able to track products and would not be "blackmailed" by the retail lobbies.
Tarin said that there was no implementation plan to fix the economy since 1972 and the Planning Commission was destroyed.
He said that the Economic Advisory Council (EAC) was asked to make holistic plans for 14 sectors of the economy.
He said that the prime minister's vision is to transform Pakistan on the pattern of "State of Medina", and it required money. It cannot occur until and unless we collect taxes, he added.
"If we would achieve growth of six to eight percent on a sustained basis then we will be able to create two million jobs entering into market on per annum basis," Tarin said.
He said that Pakistan's 60 percent population was below 30 years of age and if they remained jobless it could create chaos.
The finance minister said that if the population dividends were not ensured then it would result into disasters.
Tarin said that Pakistan failed to improve its tax-to-GDP ratio mainly because vested interest in the country did not allow to expand the narrowed tax base.
He commended the efforts of the chairman FBR and his team that they were using technology to broaden the tax base.
The finance minister said that the Universal Self-Assessment Scheme (USAS) has been introduced and now third-party audits would be carried out.
He said the technology would be utilized to bring retailers into the tax net.
He said that Track and Trace System would help to achieve the ambition to bring more people into the tax net.
Copyright Business Recorder, 2021
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