Govt to Pay Back Those Who Had Contributed to Qarz Utaro Mulk Sunwaro Scheme in 1997

Secretary Finance Dr Waqar Masood has stated that the Central Bank would issue a circular to all banks for directing them to pay back deposit amount of all those who had contributed with Qarz Hasna for “Qarz Utaro Mulk Swanro” in 1997 for the purpose of retiring national debt.

The Senate Standing committee on Finance held its meeting under chairmanship of Senator Saleem Mandviwalla in which Secretary Finance Dr Waqar Masood assured the committee that the central bank would issue a circular to all banks, directing them to pay back deposit amount of all those who had contributed as Qarz Hasna for “Qarz Utaro Mulk Swanro” on Feb 23, 1997 for the purpose of retiring debt.

The representatives of the State Bank of Pakistan (SBP) told the committee that the National Debt Retirement Program (NDRP) was stopped in 1999 and its account was closed down in 2005. Under this scheme, the government had sought donations, Qarz-e-Hasna and term deposit, the government had received total amount of Rs 2.805 billion in shape of Rs 2.032 billion as donations, Rs 470.659 million as Qarz-e-Hasna and Rs 302.540 million as term deposit out of which the government had retired Rs 1.7 billion debt so now balance was available to the tune of Rs 1.105 billion.

Secretary Finance told the committee that the government would retire the debt with available balance.

Chairman Senate Standing Committee Saleem Mandviwalla said that there was no mechanism for getting back the money who had contributed as Qarz-e-Hasna. On this issue, Secretary Finance made commitment that the SBP will issue a circular, directing all banks to pay back the money to those who had deposited amount under this head.

The Senate Standing Committee on Finance has unanimously recommended the government to announce general tax amnesty scheme for all sectors of the national economy following the same pattern of recently issued scheme for real estate.

The committee also asked the Federal Board of Revenue (FBR) to prepare proposal for general tax amnesty scheme and present it before the committee. While discussing general tax amnesty scheme, the Chairman of the committee Saleem Mandviwalla said that the FBR had always taken stance that there was no amnesty under consideration for the real estate but finally the bill was approved by the National Assembly.

Rehmatullah Wazir, Member FBR Inland Revenue (Policy) and Dr Iqbal argued before the committee that the Board had opposed this scheme but the Parliament was sovereign and passed the amnesty scheme for the real estate on the pretext that there was difference between DC rates and FBR’s notified rates so on this difference the amnesty was offered to whiten the money at fixed rate.

Senator Mandviwalla raised a question as to why such a scheme was offered only to real estate?

Responding to this, the FBR’s Member IR Rehmatullah Wazir told the committee that the property’s amnesty scheme could be availed till next finance bill 2017. So far 1919 transactions were done by declaring Rs 1.4 billion and the paid tax stood at Rs 51 million since December 7, 2016.

Senator Mohsin Aziz belonging to PTI said that there were contradictory legislation done by the government as on one side they introduced amnesty scheme for real estate, while on other hand they were proposing legislation against benami transactions. He said that such amnesty scheme should be provided for productive sectors like industrial sector that will generate employment opportunities.