Sales tax refunds: Supplementary grant approved by ECC

The Economic Coordination Committee (ECC) of the Cabinet has approved supplementary grant of Rs 30 billion for clearance of sales tax refunds of exporters by the Federal Board of revenue (FBR).

A day after the Prime Minister directed his economic team to streamline the refunds issue, the ECC meeting chaired by Adviser to Prime Minister on Finance Dr Abdul Hafeez Shaikh on Wednesday approved Rs 30 billion supplementary grant for payment of sales tax refund.

The meeting also approved amendments in eighteen laws and 25 legal procedures to simplify and facilitate investments in oil exploration and production sector. The amendments in laws were proposed by Energy Task Force and other stakeholders.

The ECC also considered a proposal of Ministry of Information Technology in extension of government guarantee against Rs 2.01 billion liability of Pakistan Telecom Industry of its interest payment of Rs 1.03 billion. The government guarantee was given to the National Bank of Pakistan. The IMF has fixed a limit of government guarantees under its US $6 billion programme namely extended Fund Facility.

The government constituted a seven-member committee under the chairmanship of Advisor to Prime Minister on Commerce Razak Dawood to consider and suggest recommendations to the ECC about alternative proposals within two weeks.

The ECC also constituted another committee on Ministry of Information Technology's proposal to exempt National Telecommunication Corporation from minimum 8 percent tax.

The committee included Minister for Economic Affairs Hammad Azhar, Minister for Information Technology Maqbool Ahmed Siddiqui, chairman Board of Investment and a representative of the FBR.

The ECC also decided to declare five zero-rated sectors as export-oriented sectors on a proposal of Commerce Division and approved a proposal of Power Division to include a clause in the agreements of Thal Nova Power Thar and Thar Energy Limited projects for increasing the government's limit to complete the projects from 400 days to 490 days.