ISLAMABAD: Senate Standing Committee on Finance and Revenue on Monday was informed that the whole tariff custom exercise by the Federal Board of Revenue (FBR) would help collection of additional Rs 11 billion in the national exchequer during Fiscal Year 2016-17.
Member Inland Revenue, FBR Rehmatullah Wazir informed the committee that the custom duty on import of 2300 items was proposed to be reduced from 5 to 3 per cent while the duty on 900 items was proposed to be increased from 10 to 11 percent and on 500 other items, the custom duty was proposed to be increased from existing 15 per cent to 16 per cent.
He said that the items, of which, the duty was being reduced were raw items like machinery etc, whereas on finished products the custom duty was being increased which would help protecting the local industry.
The committee was chaired by Senator Salim Madviwala which was attended by senators Kamil Ali Agha, Saood Majid, Mohsin Khan Leghari and Sardar Fateh Muhammad Hassani.
Regarding the issue of provincial sales tax, Chairman Sindh Revenue Board pointed out that it was unfair that the FBR was introducing a new clause according to which the provincial tax payers would be bound to first file their income tax returns in the FBR and then they would be allowed to file their sales tax returns.
He requested the committee to recommend for omitting the clause as it was the encroachment to the provincial authority.
Rehmatullah Wazir was of the view that this was an issue of non-tax filers and the move was to force maximum numbers of people to come into the tax net so this mechanism was in the national interest.
He insisted that the more people pay taxes the more revenue would be generated for the provinces as under National Finance Commission (NFC) Award, 57.5 per cent of the total revenue goes to the provinces.
Economic expert Qaiser Bangali on the occasion said that the FBR had other options as well to force the individuals to come into tax net like it even had the authority to arrest the tax evaders so it should omit this clause from the finance bill.
The committee recommended that the matter should be resolved administratively and not through finance bill.
On the issue of Property evaluation, the committee was informed by the FBR that new roles were being evolved for this purpose and a Malaysian company was being hired to evaluate the property according to the market value.
Kamil Ali Agha, however insisted that the existing mechanism of property evaluation should be maintained and proper improvements should be brought in this mechanism.
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