MoF-FBR body to resolve liquidity issues: Refunds held up since 2014 to be paid next week: Hafeez

Adviser to the Prime Minister on Finance, Dr Abdul Hafeez Shaikh Thursday assured the industry and businesses of the government's resolve to provide liquidity, cash flow and other allied issues to ease their difficulties in the prevailing situation and work in this regard was started with the release of more than Rs115 billion of the sales tax and income tax refunds as well as duty drawbacks held up for years.

While chairing a meeting-cum-video conference arranged at the Finance Division with leading industrialists and businessmen of the country as well as with the representative of retailers association, the adviser constituted a committee of official of the Finance Ministry and the Federal Board of Revenue (FBR) to provide tax relief to the retail sector against the coronavirus.

The adviser was presented various proposals and suggestions by the businessmen to support and provide relief to the industries, and he assured the participants of the conference that the government would carefully and favourably study all the proposals, and all the major issues faced by the industry and businesses would be resolved, and a comprehensive relief package would be offered to the industry.

The adviser stated that the government had released Rs52 billion of the claimed Rs57 billion to exporters through the FASTER system, and Rs25 billion out of the Rs52 billion sales tax refunds for other sectors and industries, while the remaining would also be cleared within next one week.

Similarly, the government had also cleared about Rs30 billion tax refunds under the DLT, while Rs15 billion duty drawbacks had also been paid.

"Not only this, the government has also decided to pay within the next week all income tax refunds held up since 2014, and this measure alone would benefit nearly 100,000 taxpayers who would be paid over Rs50 billion worth of refunds," he added.

The businessmen and industrialists giving their proposals and suggestions called for an inclusive relief package that addressed the needs of the large-scale as well as SME sectors.

Shaikh also constituted a five-member committee comprising senior officials from the Finance Division and the Federal Board of Revenue (FBR) was directed to sit with representatives of the retail sector and finalise proposals for providing relief to the sector in the wake of prevailing situation. The decision was taken after the video conference meeting with the representatives and office-bearers of Retails Association of Pakistan to discuss the problems faced by the sector and their possible solutions.

The adviser on finance was informed by the representatives of the association that the retail sector in Pakistan was contributing 18 per cent to the gross domestic product (GDP) and was employing 16 percent of the labour force.

However, following prevailing circumstances after the coronavirus and lockdown, the sector was foreseeing a negative growth in the current year, therefore, it was important that the retail sector should be provided relief, particularly in taxes, especially the integrated sector.

Shaikh told them that the government was keen to help the retail sector, and constituted a committee to further discuss and firm up proposals offered by the representatives of the Retails Association of Pakistan before the next meeting, which would finalise the proposals.

The adviser also directed the committee to follow a quick-action approach to decide the mechanism of support as the government wanted to reduce the difficulties being faced by the various sectors of the economy.

Minister for Industries and Production Muhammad Hammad Azhar, Adviser to the Prime Minister on Commerce and Investment Abdul Razak Dawood, FBR Chairperson Nausheen Javaid Amjad and senior officials of the Finance Division were also present during the meeting.