Finance Bill sails through: tax-related amendments moved by treasury approved

The National Assembly on Saturday approved federal budget with a total outlay of Rs 4.3 trillion, including the Finance Bill 2014, accepting all tax-related amendments moved by the government and rejecting all moved by the opposition parties. Prime Minister Nawaz Sharif was also present in the Lower House who thumped the desk in appreciation of the approval of the Finance Bill.
Following a nine-day discussion, the 149-page Finance Bill was moved by minister for finance and passed by the House with a majority in clause-by-clause reading. The bill will become law following the signature of the president and would be effective from July 1 this year. Once signed into law, crop insurance will be raised to 25 acres and price of fertilisers will be reduced by Rs 300 per bag. The government will also impose a uniform income tax of 4 percent on first class/business class air travel and would reduce the sales tax on solvent extractors from 17 percent to 16 percent.
The government will withdraw the exemptions of Rs 103 billion as part of its drive towards phased-elimination of Statutory Regulatory Orders (SRO) that favoured the influential. Winding up the debate, the Finance Minister informed the House that forex reserves of the country have reached $14.2 billion. "The government's prudent policies are starting to pay off. We're struggling hard to improve the economy," he said in a jubilant tone. Responding to the points raised by the opposition benches, he said the government is giving a subsidy of Rs 21 billion on petroleum products to facilitate people.
The minister said that around 16 percent of the electricity is being stolen at the moment while the government is struggling to bring it down to 9 percent in a year. "The government has given Rs 200 billion to provinces this year and we are planning to increase it to Rs 300 billion in the next year," he said. Responding to the points raised by Awami Muslim League Chief Sheikh Rashid Ahmad, he said the government is making appointments purely on merit. The appointments are being made following recommendations of the appointment commission constituted by the Supreme Court of Pakistan, he said.
"If the opposition points out any specific anomaly in the appointments, it would be conveyed directly to the Prime Minister," he said. The minister said that the Prime Minister has repeatedly vowed to end load-shedding within the next three to four years. "At the moment, the country is facing a shortfall of 4,500 megawatts and we are trying to plug it by increasing power generation," he said.
Talking about the Nandipur power project, he said the project is fully functional and producing electricity. "The baseless propaganda against the project is beyond my comprehension," he said. The minister stated that with the appreciation of the rupee vis-à-vis the dollar the country's total loans have declined by Rs 700 billion.
Laptop scheme is launched for youth of the country, he said, adding that the opposition should not criticise the scheme without reason. "The national resources are for poor and deserving people and we are trying our best to make sure they are fairly distributed," he said. The Metro Bus Project was initiated after getting approval from the Ecnec, he said, adding that "the Ecnec meeting was called only once in a year by the previous government, but now it is called every month."
Earlier, PPP member Naveed Qamar said the taxation powers should not be relegated to the Federal Board of Revenue as it would undermine the power of the parliament. "All amendments pertaining to taxation should be introduced in parliament," he suggested. On one hand, the government is promising to end the SRO culture and assuring the International Monetary Fund to reform the system, but on the other, the FBR is being given extraordinary powers. "The FBR should be strengthened for tax collection instead of the powers to increase or decrease taxes at will," he said. Responding to these points, Ishaq Dar said the government has eliminated the sweeping powers of the FBR to make it a responsible and cogent institution. "We want to bring financial discipline by correcting the errors made by the past government," he said.