Latest news with #NationalAssemblyStandingCommitteeonFinance
Business Recorder
23-05-2025
- Business
- Business Recorder
NA body informed: sales tax imposition at import stage under EFS likely
ISLAMABAD: Federal Board of Revenue (FBR) Member Inland Revenue Najeeb Ahmad on Thursday disclosed before the National Assembly Standing Committee on Finance that the sales tax is likely to be imposed on the import of raw materials/inputs used in the export of finished goods under the Export Facilitation Scheme (EFS) in coming budget (2025-26). This budget proposal of the FBR has been disclosed by FBR Member IR Policy during the meeting of the National Assembly Standing Committee on Finance on Thursday. The FBR Member informed that there is a likelihood of imposition of sales tax at the import stage under the EFS. This proposal was overlooked during last year budget finalisation exercise. The International Monetary Fund (IMF) wants standardisation of sales tax rates and abolition of lower rates or special tax regimes for all sectors. FBR endorses viewpoint of Senate panel: Undue taxation relocating businesses to Dubai Last year, sales tax zero rating on local supplies to registered exporters authorised under Export Facilitation Scheme, was withdrawn through Finance Act, 2024. He stated that Prime Minister's Committee on Export Facilitation Scheme (EFS), headed by Federal Minister for Planning and Development Ahsan Iqbal has also submitted recommendations on the EFS. On the proposal of exporters to restore final tax regime, FBR Member stated that the IMF would not allow restoration of Final Tax Regime (FTR) for exporters, FBR Member said. FBR Member said that the IMF had objected last year about special tax treatment to exporters as compared to other sectors which are paying standard rate of corporate tax. Therefore, the special class of taxpayers (exporters) were brought under the normal tax regime. Responding to this, Naveed Qamar MNA objected that bringing exporters under the normal tax regime does not allow double taxation on exporters. This kind of double taxation to impose minimum tax regime as well as normal tax regime on exporters is not justified. Karachi Chamber of Commerce and Industry (KCCI) President, Muhammad Javed Balwani informed the committee that the exporters are paying taxes from 29 percent to 45 percent under normal tax regime. The shift from a one percent turnover-based FTR to the standard taxation at 29% of taxable profit has increased the tax burden and compliance requirements for exporters. This disrupts the ease of doing business, reduces transparency, and affects the competitiveness of export-oriented businesses. He said that the small and medium exporters are vanished from the market due to high tax rates and financial cost of business. 'We do not have any cash flow to do business. The refunds under 'FASTER' system are paid in months against declared time of 72 hours,' he stated. The last budget removed zero-rating on local supplies for exporters under the Export Facilitation Scheme (EFS), increasing their cost burden significantly. Additionally, the withdrawal of Regional Competitive Energy Tariffs (RCET) has raised utility rates (power and gas), he added. Copyright Business Recorder, 2025
Business Recorder
23-05-2025
- Business
- Business Recorder
NA body informed: ST imposition at import stage under EFS likely
ISLAMABAD: Federal Board of Revenue (FBR) Member Inland Revenue Najeeb Ahmad on Thursday disclosed before the National Assembly Standing Committee on Finance that the sales tax is likely to be imposed on the import of raw materials/inputs used in the export of finished goods under the Export Facilitation Scheme (EFS) in coming budget (2025-26). This budget proposal of the FBR has been disclosed by FBR Member IR Policy during the meeting of the National Assembly Standing Committee on Finance on Thursday. The FBR Member informed that there is a likelihood of imposition of sales tax at the import stage under the EFS. This proposal was overlooked during last year budget finalisation exercise. The International Monetary Fund (IMF) wants standardisation of sales tax rates and abolition of lower rates or special tax regimes for all sectors. FBR endorses viewpoint of Senate panel: Undue taxation relocating businesses to Dubai Last year, sales tax zero rating on local supplies to registered exporters authorised under Export Facilitation Scheme, was withdrawn through Finance Act, 2024. He stated that Prime Minister's Committee on Export Facilitation Scheme (EFS), headed by Federal Minister for Planning and Development Ahsan Iqbal has also submitted recommendations on the EFS. On the proposal of exporters to restore final tax regime, FBR Member stated that the IMF would not allow restoration of Final Tax Regime (FTR) for exporters, FBR Member said. FBR Member said that the IMF had objected last year about special tax treatment to exporters as compared to other sectors which are paying standard rate of corporate tax. Therefore, the special class of taxpayers (exporters) were brought under the normal tax regime. Responding to this, Naveed Qamar MNA objected that bringing exporters under the normal tax regime does not allow double taxation on exporters. This kind of double taxation to impose minimum tax regime as well as normal tax regime on exporters is not justified. Karachi Chamber of Commerce and Industry (KCCI) President, Muhammad Javed Balwani informed the committee that the exporters are paying taxes from 29 percent to 45 percent under normal tax regime. The shift from a one percent turnover-based FTR to the standard taxation at 29% of taxable profit has increased the tax burden and compliance requirements for exporters. This disrupts the ease of doing business, reduces transparency, and affects the competitiveness of export-oriented businesses. He said that the small and medium exporters are vanished from the market due to high tax rates and financial cost of business. 'We do not have any cash flow to do business. The refunds under 'FASTER' system are paid in months against declared time of 72 hours,' he stated. The last budget removed zero-rating on local supplies for exporters under the Export Facilitation Scheme (EFS), increasing their cost burden significantly. Additionally, the withdrawal of Regional Competitive Energy Tariffs (RCET) has raised utility rates (power and gas), he added. Copyright Business Recorder, 2025
Business Recorder
10-05-2025
- Business
- Business Recorder
Tax law: NA body says govt has bypassed Parliament
ISLAMABAD: The National Assembly Standing Committee on Finance on Friday categorically conveyed to the Federal Board of Revenue (FBR) that the government has bypassed Parliament for promulgating Tax Laws (Amendment) Ordinance, 2025, and urgently communicated ordinance to the FBR's field formations for recovery from taxpayers. The National Assembly Standing Committee on Finance discussed the situation arising from the Promulgation of Ordinance No IV/2025 with particular reference to concerns of stakeholders and trade bodies. Chairman of the committee MNA Syed Naveed Qamar expressed serious concern that it is abuse of power to promulgate an ordinance for recovery from taxpayers without giving them right of appeal. FBR Chairman Rashid Mahmood responded that there is no abuse of power through promulgation of this ordinance. The ordinance has been cleared from the federal cabinet as well as the president of Pakistan. NA body adopts report on Tax Laws (Amendment) Bill: Restrictions on transactions of non-filers from July 1 The chairman of the committee directed the Law and Justice Division to immediately table the ordinance before the parliament for urgent action on this legislation. 'The government has urgency to promulgate the ordinance instead of making it part of the Finance Bill (2025-26). We have also same urgency to review the ordinance,' he added. The representative from the Ministry of Law and Justice informed the committee that the ordinance would be presented as a bill in the current National Assembly session, which would subsequently, be referred to the committee for consideration and report. The committee chairman questioned, what was the urgency to take these recovery measures through ordinance. The representative of the Law Division stated that there was an urgency but he failed to explain the urgency of the government. The committee deliberated on the urgency and rationale behind the ordinance while expressing concerns over its potential impact on various sectors across the country. Members emphasised that amendments to the law must be carefully evaluated to avoid unintended consequences on other categories. Naveed Qamar stated that the FBR has no answer to convince the committee about the urgency for promulgating this ordinance. 'We are waiting for the Ordinance to come to us in the form of a bill and we will question and securitise this ordinance,' Qamar said. The FBR chairman requested the committee that the ordinance is promulgated for a limited time period and the committee should give them 1-2 months to see the operations of the ordinance. The amendments in tax laws could have been passed through Finance Bill (2025-26), but you have shown urgency, the chairman committee responded. MNA Mirza Ikhtiar Baig stated that the Ordinance is totally contradictory to the FBR's commitment of business friendly environment. The trade bodies including Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has strongly agitated against the said ordinance. The committee members also raised question about the repercussions of the Tax Laws (Amendment) Ordinance, 2025 on judiciary. At one stage, the FBR chairman stated that it is the prerogative of the legislator to reject this legislation. The FBR chairman explained that the FBR only wants to implement the orders of the High Courts. This ordinance introduces only three carefully scoped amendments, addressing urgent legal, administrative, and enforcement gaps in the tax system. Although the courts are now resolving cases promptly, a procedural lacuna in the law previously allowed taxpayers a 30-day delay in making payments on confirmed demands—even when the matter had been conclusively decided by the apex courts. As a result, billions in confirmed revenue remained unrealised despite clear court verdicts. The amendment through Sections 138(3A) and 140(6A) seeks to curtail this delay and allow for swift implementation of final judgments issued by the Supreme Court and High Courts, the FBR chairman added. Copyright Business Recorder, 2025
Express Tribune
30-04-2025
- Business
- Express Tribune
NA panel dilutes tax bill 2024
The National Assembly Standing Committee on Finance on Wednesday adopted a softer version of a bill to ban purchases of cars, investment in stocks and properties beyond a certain value by ineligible persons but linked its approval by the National Assembly with budget. Headed by PPPP MNA Syed Naveed Qamar, the committee instructed that the modified version of the Tax Laws (Amendment) Bill 2024 be included in the Finance Bill 2025. The committee further decided that the modified bill's approval will be secured from the National Assembly along with next fiscal year's budget. Unlike in the past when the National Assembly standing committee on Finance was not allowed to discuss the Finance Bill, this time the committee would go through the new taxation proposals after changes in the rules. The modified version is quite different from the original bill proposed by the Federal Board of Revenue. It exempts a major segment of the society from the applicability of the law. The definition of the eligible persons has been expanded and the list of the assets that can be used to justify the purchase has been enlarged. The committee decision came on the recommendation of a sub-committee in which PTI's Usama Mela and MNA Jawed Hanif played important roles. The government had introduced the Tax Laws Amendment Bill in the National Assembly to ban economic transactions by the ineligible persons – the ones who do not have sufficient declared cash equivalent resources to buy a property. According to the proposed legal amendment, a person cannot buy a property until the assets declared in his last year's tax returns are sufficient for the purchase or the person will submit a new statement to disclose the source of buying the property. The FBR has not yet developed a real time safe technological solution where the buyer is required to file the declaration. The FBR had proposed Section 114C as an additional layer of declaration and the FBR still had the legal authority to verify those assets, once the purchaser submitted its income and wealth statement every year. There are two significant amendments by the standing committee. According to a change in the proposed Section 114C, the new law cannot be implemented without determining the value threshold by the federal government. The "property transactions conducted by common citizens and the lower- and middle-income class, particularly first-time buyers or those purchasing their primary residential property, are not impacted" by the new legislation. The definition of the eligible persons has also been expanded by including the immediate family members' assets to justify the purchase. Importantly, the definition of "sufficient resources" has also been enlarged by adding local and foreign currencies, fair market value of gold, net realised value of stocks, bonds, receivables or any other cash equivalent assets as may be prescribed". The barter transactions have also been allowed to settle the value of one plot against another plot. In the past, the government had also imposed withholding taxes to encourage people to become tax filers. But people have been filing the tax returns just for the sake of undertaking a property transaction and the FBR seemed satisfied with only getting an extra amount of taxation instead of going after them for not fully paying their taxes on actual incomes. It was also decided that even if Section 114C was passed in the budget; it would not come into effect until the exemption value was notified by the federal government. The committee also amended the clause related to the immediate family members and introduced the definition of dependent children instead of using the terms son and daughter. The non-resident Pakistanis and the listed companies will be exempted from filing the additional information disclosure. Some of the members of the committee had in the past expressed reservations about relaxing these definitions. The committee's decision will exclude 95% people from the purview of the new amendments and it means that there can never be true documentation in Pakistan," said MNA Jawed Hanif Khan in February this year. ZTBL turns around The National Assembly expressed reservations against the government's decision to sell the Zarai Taraqiati Bank Limited despite it having been turned around and being the only specialised bank that serves the under-privileged farming community. The committee decided to raise the matter of the ZTBL privatisation in the National Assembly to put pressure on the government to drop the transaction. The ZTBL's listing in the privatisation programme has stopped the progress on the new information technology programmes and we cannot even hire a person despite pressing needs, the ZTBL president Tahir Yaqoob Bhatti informed the standing committee. Being a three-time former privatisation minister I can sense that the bank's privatization cannot happen in the next two years and there is no rationale to stop the important work at the bank, remarked Syed Naveed Qamar.
Express Tribune
30-04-2025
- Business
- Express Tribune
Govt violates minimum Rs37,000 wage policy
Listen to article In a startling disclosure at the forum of a parliamentary committee on the eve of International Labour Day, a few government departments and contractors of the Parliament cafeteria are not paying the minimum guaranteed wage of Rs37,000 per month to their employees. This disclosure was made at the forum of the National Assembly Standing Committee on Finance on the eve of May 1 2025, which is celebrated world-wide to promote the cause of the labour class. The evelation about the violation of the minimum wage policy prompted the Finance Minister Muhammad Aurangzeb to promise to take up the issue with Minister for Human Resources and Overseas Pakistanis Chaudury Salik Hussain. Ironically though, the Human Resource Minister's ministry is violating the minimum wage, which Aurangzeb announced in his first budget speech. Hussain's ministry is also one of those violators that are not paying the minimum wage, said Member of National Assembly (MNA) Agha Rafiullah who brought up the issue in the committee. According to a written reply submitted before the National Assembly, MNA Agha Rafiullah revealed that the Overseas Pakistanis Foundation working under the control of the Ministry of Overseas Pakistanis, is paying Rs28,000 monthly to its employees working in various education institutions. This translated to Rs9,000 or 24% less than the minimum guaranteed wage of Rs37,000. The Finance Minister had demanded the names of the violators and upon learning the details, he promised to take up the matter with the Overseas Minister. Additional Secretary Finance Ministry Amjad Mehmood informed the standing committee that upon inquiry, the overseas ministry claimed that it was paying the minimum wage of Rs37,000. "When the government is not honouring the minimum wage commitment, then how can we expect it from the private sector?" remarked committee chairman Syed Naveed Qamar. Agha Rafiullah further disclosed that among the other government departments that were not paying minimum wage were the Ministry for Inter-Provincial Coordination, the National Counter Terrorism Authority, and the National Bank of Pakistan working under control of the Ministry of Finance and Export Processing Zones. He went on to say that even the employees working at the Parliament's cafeteria are not being paid the minimum wage of Rs37,000 by the contractors. According to a list submitted in the NA Committee by MNA Rafiullah, the Pakistan Sports Board and Federal Land Commission were not paying the minimum wage either. Additionally, the National University of Technology under the Ministry of Science and Technology, and Pakistan Television (PTV), were found not complying with minimum wage requirements. He said that the federal directorate of education has also entered into a contract with a non-governmental organisation to pay Rs12,000 to Rs15,000 per month to teachers, which is a violation of the government's policy. Likewise, the Ministry of Interior's licensed private security companies were not paying minimum Rs37,000 wage to their security guards. In his Labour Day message, Prime Minister Shehbaz Sharif has "reaffirmed Pakistan's unwavering commitment to promoting safe, healthy, and dignified conditions for its workers - the real driving force behind our nation's growth and resilience." "The protection of fundamental labour right is enshrined in our Constitution and fully aligns with the International Labour Organiation's (ILO) core conventions, to which Pakistan is a responsible signatory," according to the Prime Minister. He stated that Pakistan has taken significant legislative and administrative reforms to further strengthen workers' protections. Our government has taken important steps to broaden the coverage and impact of institutions such as the Employees' Old-Age Benefits Institution (EOBI) and the Workers Welfare Fund (WWF), ensuring that the fruits of our labour protections are shared more equitably across all segments of the workforce, he added. "On this important day, I urge all stakeholders, including employers, workers, civil society, and government to join hands in building a culture that respects labour, upholds their rights, and creates opportunities of decent work for all," affirmed PM Sharif.
