ISLAMABAD: The National Assembly’s Standing Committee on Finance on Tuesday asked the Power Division to halt implementation on withdrawal of Rs80 billion subsidy for five zero-rated export-oriented sectors and referred this matter to the ECC for final decision.
The NA panel also directed the FBR for release of stuck up refunds. The standing committee held its meeting under chairmanship of Faizullah Kamoka here at Parliament House in which the stakeholders informed the committee that the government has started collecting increased tariff along with recovery of arrears from zero-rated five export-oriented sectors. The government had fixed 7 cents (Rs11 per unit) electricity from industrial units but now the Power Division started collecting all surcharges and taxes that would result into damaging the industries.
The chairman of the committee along with other members took up the issue that why the Power Division did not get approval of the ECC for withdrawal of subsidy and issued notification directly to this effect.
Abid Lodhi, Additional Secretary Power Division, informed the NA panel that the government issued notification with effect from January 1, 2019 for providing subsidy to industrial sector as the rate of electricity was fixed at 7.5 cents for different categories. However, later on, it was explained through another notification on January 13, 2019 for removing confusion related to subsidy because the provision of subsidy was only meant for poor segment of the society.
The chairman of the committee reminded that the last year when Asad Umar as finance minister visited Faisalabad he had announced that the provision of gas and electricity would be provided at subsidised rates of 6.5 per mmbtu for gas and 7.5 cents for electricity. The PML-N MNAs Ayesha Ghous Pasha and Ali Pervez Malik opposed the Power Division’s stance and stated that the subsidy included all kind of surcharges so it could not withdraw surcharges through their own interpretations.
The chairman of the NA panel was of the view that the bureaucracy was conspiring against the vision of Prime Minister Imran Khan so he would take up this issue with the premier that the bureaucracy was not implementing the decisions of the government.
The NA panel also took up issue of stuck up tax refunds. Acting chairperson FBR Nausheen Amjad Javed informed the committee that the FBR released sales tax refunds of Rs25.5 billion against total claims of Rs34 billion so far in the current fiscal year.
After withdrawal of zero rating regime, the FBR’s Member Inland Revenue (Policy) Dr Hamid Ateeq Sarwar told the committee that after abolishing of zero-rating regime for five export sectors the FBR had estimated to provide refunds to the tune of Rs85 billion out of which Rs40 billion refunds were already piled up. On implementation of CNIC condition, the FBR chairperson said that this was aimed at broadening of tax base. The FBR and traders, she said, constituted committees and implementation on CNIC condition had already started.
