Business accounts’ audit to be done once in 3 years: Dr Hafeez

ISLAMABAD: Prime Minister Imran Khan has shown government’s inability to review the power purchase agreements (PPAs) earlier done with Independent Power Producers (IPPs) saying the government has extended the sovereign guarantees against the said PPAs.

He responded to the assertion of business tycoon Aqeel Dhedhi from Karachi in the meeting of business community. He said reviewing the PPAs with IPPs is not possible as the government has extended sovereign guarantees and if the government goes against it and start reviewing the PPAs, then it will have to face the legal repercussions at international level as the IPPs can move the government to arbitration, a senior official who was part of the meeting told The News.

Dhedhi had raised the issue of power sector’ inefficiencies owing to which the circular debt has increased manifold by Rs1.4 trillion. He pointed out that the power tariff is at higher side and urged the Prime Minister to start reviewing the PPAs with IPPs. He also argued saying that the government delays to pay the refunds of the business community that stand at Rs200 billion as it consumes the amount to be refunded in other heads such as financing the Public Sector Entities (PSEs) which are going in loss since long. He also pitched his argument saying that the refunds amount is also spent in off loading the curricular debt.

Earlier in the meeting of representatives of FPCCI and APTMA with the government’s economic team held here on Thursday, Adviser to PM on Finance, Revenue and Economic Affairs Dr Hafeez Shaikh has agreed to carry out the audit of the business accounts once in three years as earlier in the budget denouements tabled in parliament, the financial wizards of the sitting government proposed the audit of the said accounts every year.

The announcement in the budget that every year business accounts will be audited that had irked the business community. However, in the meeting of FPCCI and APTMA delegations with the government economic team headed by Dr Hafeez Shaikh held here on Thursday, the government gave its consent saying it is ready to carry out the audit of business accounts once in three years time.

In the meeting, the main two business representative bodies had agitated this very issue among others arguing that carrying out audit of business accounts in every will be detrimental to the business as the business community will consume its all time to get accounts audited whole the year. ‘Moreover, in one year changes in accounts don’t take place.’

FBR Chairman Shabbar Zaidi also agreed, according to the official, to accommodate the business community and under new understanding, no tax officer will be able to raid any business house and the residence of the business man. If there is any demand, then the tax officer will be left with no option but to issue the notice to the businessman under question and if no reply comes from the said businessman, then give another notice and even no response (readiness to answer or not what is being asked by tax officer) is received, then tax officer will seek permission from FBR chairman for action against the said business house.

However, the press release issue from Finance Ministry says a delegation of Federation of Pakistan Chamber of Commerce and Industry (FPCCI), led by its President Engr Daroo Khan Achakzai, and All Pakistan Textile Mills Association, held separate meetings with the Adviser to the Prime Minister on Finance, Revenue and Economic Affairs, Dr Abdul Hafeez Shaikh, here. Welcoming the delegations, the Adviser briefed the participants about the economic priorities of the government. He informed that the government had taken austerity measures by reducing its expenditure up to Rs50 billion as well as making 10% decrease in the salary of the Prime Minister and his Cabinet members. Spelling out the priorities of the government, the Adviser stated that initiatives had been taken to curb external deficit and fiscal deficit by reducing the expenditure and enhancing the revenue of the country. He urged the business community to support the government in its endeavours to boost the economy.

The delegations apprised the adviser of their problems and proposed a range of suggestions. The Adviser assured them that their suggestions would be accommodated. The meeting approved the demand of business community to develop criteria in which a person is not repeatedly selected for audit without any definite information about tax evasion. In order to facilitate the business community, Chairman FBR assured that a new system of refund would be introduced to issue refund to the exporters at the time of export. The meeting agreed to streamline DTRE system for the importers so as to discourage misuse, if any. The meeting agreed that no action would be taken against the taxpayers on the basis of any wrong information with respect to CNIC. However, the condition of CNIC, for invoice, will be continued with an object to document the economy. Regarding the commercial imports, the meeting approved the proposal of the business community to do away with presumptive tax on commercial imports.

The members of FPCCI and APTMA thanked the Adviser for accommodating their proposals.

Among others, the meeting was also attended by the Adviser to PM on Commerce, Textile, Industry and Production and Investment, Mr. Abdul Razak Dawood, Secretary Finance, Naveed Kamran Baloch, Chairman, FBR, Shabbar Zaidi and other senior officials of Finance Ministry.