ISLAMABAD: The Senate Standing Committee on Finance has sought details of the educational and health institutions from the Federal Board of Revenue (FBR) getting exemptions from income tax, sales tax, federal excise and customs duty.
The committee meeting presided over by Senator Saleem Mandviwalla on Tuesday discussed exemptions from income tax, sales tax, federal excise duty, and customs duty granted to educational and health institutions.
The FBR chairman said exemptions are given to non-profit entities whose revenues are reinvested in institutional expansion.
25-30pc sales tax on essential healthcare products assailed
The committee emphasised the need for monitoring to ensure funds are used appropriately and sought list of the instructions which are granted exemptions.
The committee was also updated on the budget recommendations made by the Finance Committee. The FBR chairman told that committee that out of 96 recommendations, 49 pertained to the Finance Act, with 22 implemented and 14 fully executed.
Only nine recommendations concerned the Finance Division, while the rest were related to the FBR.
Senator Farooq H Naek raised objection to impose tax on stationery. The FBR said that the matter was taken up with the IMF but the Fund was opposed to tax exemption on stationery. Naek said that the FBR has not contested Pakistan’s case properly before the IMF as the country needs affordable education for the fact that most children in the country are out of school.
The committee also reviewed the status of officers assigned as officer on special duty (OSD) and the meeting was informed that no officers have been on OSD in the past two years. The chairman expressed concerns over lists of officers purportedly being sent to OSD by the Prime Minister’s Office, adding that such actions require evidence.
Teachers, researchers: APSUP, PAMI urge govt to restore tax rebate
The FBR stated that officers are not sent to OSD without substantiated evidence or disciplinary proceedings. The chairman said that the FBR chairman has also decided to take early retirement.
The FBR chairman said that he wanted to take premature retirement based on personal reasons and suggested that an in-camera meeting of the committee should be convened and officials be also invited to give their side’s version. The committee decided an in-camera meeting on the issue.
The committee resolved to dispose of several government bills, including, “The Deposit Protection Corporation (Amendment) Bill, 2024,” “The Banking Companies (Amendment) Bill, 2024,” and “The Equal Scales of Salary and Allowances Bill, 2024,” advising that they be reintroduced by the new government as interim government was not allowed to introduce these bill.
Senator Naek pointed out that the interim government lacks the authority to amend the constitution. The committee ratified the nomination of Senator Zamir Hussain Ghumro to the FBR Policy Board.
The State Bank of Pakistan (SBP) has requested an in-camera meeting to discuss measures to prevent money laundering related to solar panel imports.
The committee deferred discussion on suspicious banking transactions, directing the Financial Monitoring Unit (FMU) to provide a detailed briefing on the legal criteria for identifying suspicious transactions. Concerns were raised about potential misuse of suspicious transaction reports (STRs), with approximately 1,600 STRs reported this year.
The issue of import of Hydrocarbon Solvents was also taken up by the committee after Federation of Pakistan Chambers of Commerce and Industry (FPCCI) representative Alamgir Durrani said that currently, more than 500 consignments of aliphatic solvent and other petrochemicals remain unreleased from the MCC Appraisement Quetta despite having paid all duty taxes and submitted the required lab reports, due to issues related to the DPL.
He said that historically, it started from Karachi where the import continues to date and only last year, approximately 40,000 MT of the same product was imported through Karachi collectorate.
The committee expressed surprised that this was happening for the last 20 years and wondered what led to change in it overnight without giving enough time to the importers.
The chairman of the committee said that such decisions were not good for the economy and asked the FBR chairman to clear existing consignments and give enough time to the importers for complying with the decision.
The committee addressed the issue of 500 consignments of light aliphatic hydrocarbon solvent, which is used in petroleum. It was suggested that this product should be classified as a petroleum product. The matter was referred to the Ministry of Commerce to be dealt with appropriately.
Copyright Business Recorder, 2024