Senate Body Briefed On 55 Recommendations For Financial Budget, 2023

The Senate Standing Committee on Finance and Revenue was briefed on Thursday that the Fiance Division's Budget Wing received 55 recommendations for Financial Budget 2023 from the Senate Committee. However, most of the recommendations were related to Federal Board of Revenue (FBR)

ISLAMABAD, (UrduPoint / Pakistan Point News - 20th Jul, 2023 ):The Senate Standing Committee on Finance and Revenue was briefed on Thursday that the Fiance Division's Budget Wing received 55 recommendations for Financial Budget 2023 from the Senate Committee. However, most of the recommendations were related to Federal Board of Revenue (FBR).

The Committee met under the Chairmanship of Senator Saleem Mandviwalla here at the Parliament House While vetting upon the recommendations adopted by the Revenue Division, it was observed by the Committee that many of the recommendations were agreed upon except those which were intervened by the IMF.

The Committee received the briefing on the inclusion of the budget recommendation of the Senate in the Budget 2023-24.

The Ministry briefed that recommendations related to the privatization of loss-making enterprises, increased budget allocation for health sector, funds for rehabilitation of flood victims, availability of food items at subsidized rates, rise in TV Fee from 35 to 50 RPs and mechanism for subsidies on fertilizers, solar energy production and daily food items were fully adopted, however, the Ministry partially adopted recommendations such as grant of tax holidays to export industry, laptops schemes etc, explaining that government is providing all necessary support to IT sector and export-oriented industries.

The Committee observed that the Finance Bill 2022-23 empowers the bureaucracy to formulate zero taxation regimes.

It was also briefed by the Chairman FBR that separate rules would be prescribed for the said purpose. It was also briefed that the provision would come into play where any case, based on risk profiling; is selected for transfer of Pricing Audit.

The Committee maintained that any rules prescribed must be transparent in nature and in the larger public interest rather than self-seeking benefits.

The Finance Bill proposed to extend income tax exemption expiring on 30th day of June 2023 to 30th day of June 2024 for the residents of erstwhile FATA/PATA which was rejected by the Committee. However, the government decided to extend the exemption for one year with the aim of the development of the area and to ensure the employment of local people. The Senate Committee also raised the question on the inclusion of exemption of total turnover tax on registered sale as recommended by the committee and emphasized that turnover tax should only be imposed on unregistered sale.

The matter regarding the decision taken by the Cabinet for closing of Small and Medium Enterprize (SME) Bank was disposed of with the recommendation to the Cabinet to review the matter in the interest of the weak business community and employment associated with it. It is briefed that the Federal Cabinet approved the winding down plan of the SME Bank in the best interest of depositors and to minimize the financial losses to the national Exchequer.

It was further informed that as on 30 June 2023, the Bank successfully paid an amount of Rs 5.227 billion to its depositors and is actively following up with the remaining customers to withdraw their deposits.� Briefing on the matter of imported vintage cars still parked at dry port for clearance was also taken up, the Committee lamented that even after the exemption of customs duty, regulatory duty, additional customs duty, Federal Excise Duty, Sales Tax and Withholding Tax by the federal government on 3rd July 2018 the cars have not been released and urged to expedite the matter.

It was also recommended that handsome compensation should also be given.

The Revenue Division apprised the Committee that since the matter involved the requirements of IPO 2016, which falls in the domain of the Ministry of Commerce, therefore it was decided that the matter be taken up in the Senate Committee on Commerce along with the Commerce Ministry and raise the matter with the Federal Cabinet for relaxation on the Import Policy Order (IPO).� Regarding the matter of news of hiring Senior Executives at Zarai Taraqiati Bank Limited (ZTBL) despite Rs 100 billion losses, the Governor of� State Bank briefed that the BHCR decided to put the matter on hold which was conveyed to the concerned executives as the re-appointed of EVPs/SEVPs has not been materialized and they are working under their previous terms and condition of service, he also said that news is based on misleading information, however they are in search of a competent chief executive who can run the organization effectively.

Briefing regarding the levy of Sales Tax on packed, branded basic raw chicken meat was also taken up.

It was briefed that in order to remove the ambiguity of certain quantities of goods treated as bulk packaging and claimed as exempt from charging of sales tax although such Bulk supply was still under a brand name/trademark, the relevant entry under table-2 of the sixth schedule has been suitably amended by removing the distinction between any types of packaging whether retail or bulk consequently chicken meat uncooked poultry meat when supplied under brand names or trademarks either in retail or bulk is now chargeable to sales tax.

The Committee also discussed with the Governor State Bank other matters such as selective opening of the LCs by SBP to import EV cars even after all the restrictions are lifted, and lamented that no practical implementation has been made, similarly on the matter of 19pc interest rate on export refinancing which poses a threat to exporters the Governor State Bank of Pakistan apprised that a new policy has also been introduced for the same which mark-up is 3 percent and can be availed. Moreover, the Committee also discussed the launch of Pakistan first ever digital currency as reported by various newspapers. The Committee regretted the persistence issue of operationalization of the Board of the Bank which was assured to be operational within 2 weeks since May 2023, however the Committee remarked that no progress can be foreseen in the future.�� While discussing the matter of counteract the Hawala /Hundi system, the Committee remarked that�6 to 8 billion dollars of remittances on annual basis come through Hundi business, the committee was of the view that if the State Bank tightens the measures for remittances, It will encourage the increase in Hundi Business.

The Governor of State Bank of Pakistan said that Remittances of 27 billion dollars were recorded in the last financial year, Governor State Bank said that we are attempting to receive all remittances through the banking channel.

The meeting was attended by Senator Zeeshan Khanzada, Faisal Saleem Rehman , Kamil Ali Agha and Anwar-ul-Haq Kakar.

Senior Officials from concerned departments were also in attendance.