Senate Panel Refuses to Tighten the Noose on Non-Filers

The Senate Standing Committee on Finance and Revenue has rejected the proposal of disconnecting mobile, electricity, and gas connections of non-filers.

The meeting of the committee was held under the chair of Senator Talha Mahmood on Thursday at parliament house which discussed the third tax amendment act presented by FBR in detail.

The panel not only turned down the proposal of disconnecting mobile, electricity, and gas connections of non-filers but also rejected the proposal if providing taxpayer information to NAB.

The Chairman committee said that this is cruelty to the people of the country as such a law is a violation of basic human rights. On the other hand, Senator Mohsin Aziz said that strict action should be taken against the non-filers.

Senator Musadiq Malik said that FBR wanted to get taxpayer records to NAB due to which it has proposed this law. In addition, the Senate committee has also rejected the proposals of not only obtaining tax from professionals but also imposing a tax on the above Rs. 20,000 electricity bill. Meanwhile, they also rejected the proposal of withdrawing sales tax on the import of meltable scraps.

The Chairman committee questioned who submitted this proposal. Senator Musadiq Malik said that steel mill owners are sending such proposals and I know who is behind this.

On the other hand, the panel has approved the proposals with regard to imposing a tax on imported apples from Afghanistan, extending tax waiver on the auto-disable syringe to December 31, 2021, abolishing sales tax on import of PSO terminals, getting 16% instead of 17% sales tax from Tier-1 retailers through debit or credit card purchasing and zero-rated regime for the packed milk.

Meanwhile, it also approved a 5% tax on the import of electric vehicles and sent above Rs. 5 million remittances through banks and exchange companies. The committee also discussed the issue being faced by the Iraqi Embassy in managing a $10 million account with Habib Bank Limited (HBL) as per the policy of SBP.

The meeting has taken serious notice of the absence of the governor SBP. The chairman committee said that he can order the police to arrest or present Governor SBP, Reza Baqir, in the committee if he was not turned up in the meeting.

Senator Saleem Mandviwala said that governor SBP did not appear in the last three meetings of the committee whereas the Iraqi Ambassador has appeared in the committee. Musadiq Malik also pointed out that the Ambassador of Iraq is representing his country in the committee and wanted that a privilege motion should be moved against Governor SBP.

The Chairman of the committee said that the country faced insults as the embassy was dealing in dollars and if anything happened to their money, an FIR would be filed against the Governor SBP.

The meeting was informed that HBL, during the month of June 2021, asked the State Bank of Pakistan (Exchange Policy Department) that it allows its client, the Embassy of Iraq, Islamabad, for monthly transfer of salaries of $100,000 to FCY accounts of their foreign national employees; besides it also requested to allow monthly withdrawal of $100,000 for traveling abroad purposes and allow receiving and retaining cash deposits up to $1,000,000 on monthly basis in Embassy’s FCY account, on account of visa fees, document attestation charges, and consular service fees, in form of foreign currency from respective applicants.

The meeting was in writing informed that with respect to the above-mentioned requests, SBP allowed HBL for monthly transfer of FCY for payment of salaries only to their foreign national employees and monthly cash withdrawal on account of traveling abroad purposes (funds to be used out of Pakistan) whereas, with respect to retaining cash deposit, it was advised to the HBL that there is already a mechanism in place whereby foreign embassies/consulates operating in Pakistan, collect visa/consular fees in their Pakistani rupee accounts.

Subsequently, the fees collected may be repatriated to their respective home countries, after seeking approval from the Foreign Exchange Operations Department (FEOD), State Bank of Pakistan-Banking Services Corporation through their Authorized Dealers. However, HBL has requested SBP to reconsider the request of the Iraq Embassy.



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