The Senate Standing Committee on Finance and Revenue met today under the Chairmanship of Senator Saleem Mandviwalla here at the Parliament House.
At the outset of the meeting the committee expressed its displeasure over the failure of the Ministry of Finance to deliver the agenda documents on time. Senator Kamil Ali Agha expressed his resentment and said that the brief document is currently being received in the commitee meeting, the committee members endorsed the view point and held opinion that the agenda items should be deferred up till next meeting.
The committee took up the matter of withdrawal of money from accounts of private bank account holders. It was briefed by the Governor SBP on Five billion rupees fraud in Bank Al Habib Faisalabad withdrawn from various accounts. The Governor State Bank replied that the total amount is about 254 million on which action has been initiated against the manager, the representative of the affected families who were also present in the meeting said that the amount is around 350 million,
Of this, 270 million has been reverted to the accounts within 6 weeks and paid their gratitude to the committee for diligent oversight. The committee emphasised that such frauds in the banking sector should be monitored and action should be taken against those responsible. The committee inquired whether or not there are any other victims in this matter, to which the Governor State Bank replied that further, no affected person has come forward in this case
The Senate Committee while deliberating on the reported news regarding “world bank urges Pakistan to eliminate tax assumptions” the committee was apprised that the news article has been examined in detail the world bank acquired exemption in taxation of real estate and agricultural sector and exemption threshold on personal income tax however it was informed by the FBR that no formal communication in this regard has been made by the world bank. The FBR further more apprised that tax on agriculture income is charged and collected by the provincial governments and the federal government cannot impose tax on agriculture income. It was further added that with regards to exemption threshold of both salaries and business individuals which are present is R/s 600,000/- per annum. It was apprised that neither any policy proposal is under consideration by the FBR to change this current exemption threshold limit not the world bank has recommended to FBR to lower this threshold limit for this class of persons.
The chairman FBR debated that Provinces are failing to impose taxes on agricultural sector,
5%, 10% and 15% tax is imposed on the income of the agricultural sector, and said that there is zero tax on 4 lakh agricultural income and 1% tax on 8 lakh tax income,
5% tax is applicable on income of agriculture sector. He further informed that the number of taxpayers has reached 4.9 million, he said that in Pakistan, the tax cannot be applied on the low income which is 65% of the population, and further regretted that in Pakistan, 15 million people do not pay taxes, he said that tax gap can be bridged if 15 million people start paying tax.
The committee sought from the FBR a detailed briefing on tax payers, it’s applicability and revenue generated through the tax it also sought details on
The volume of direct and indirect taxes, details regarding smuggling and how much tax is evaded, was also sought.
During the meeting another case of difference of 8 billion dollars in import-export came to light, the Chairman Committee said that
Invoicing is being done on the items on which duty is not applicable, he said that
Before this, the case of import of solar panels has come up, the chairman FBR said that
Investigation of this matter is under way and sought a weeks time for report. The chairman FBR also said that
Efforts are underway to exchange import-export data with China. The chairman FRB said that there is a gap of $3-4 billion in trade volume with China, the member FBR informed the committee that Pakistan's trade with China is 23 percent, and said that they are working to acquire real-time data from China, and also said that Similar trade gaps exist in other countries as well.
The committee sought inquiry in the matter of 8 billion dollars difference import exports.
The committee also discussed about fake currency notes which are circulating in the market, the chairman committee said that the most fake currency notes are Rs 1,000 denomination, and said that fake currency notes are also coming out of ATM machines, the Governor State Bank has assured to change the security features of currency notes and said that this will help in curbing fake currency notes, he said that he also plans to introduce polymer currency in the future and said that It also has a higher lifeline. The committee suggested introduction of plastic currency to discourage fake currency notes
The meeting was attended by Senators Kamil Ali Agha, Musadik Malik, Zeeshan Khanzada, Sherry Rehman, Mohsin Aziz and Senator Farooq H Naik. Officials from the Ministry and other related departments were also in attendance.