Discussing the Finance Supplementary Bill 2021 for the second consecutive day, the Senate Standing Committee on Finance recommended on Thursday withdrawal of the proposed 17 percent general sales tax (GST) on gold jewelry and also opposed the proposal to impose the same on milk formula.
The Senate panel meeting was held with Senator Talha Mahmood in the chair. Annoyed at the absence of Minister for Finance Shaukat Tarin, the committee members said they should reject the bill. The members and the Federal Board of Revenue (FBR) officials expressed their views, observations, and reservations on the proposals made under the bill.
Representatives of the Pakistan Jewelers Association told the committee that up to 180 tons of gold jewelry were traded in the country every year. The committee was informed that almost 80 tons of gold was smuggled into the country. The committee recommended taking back the proposed 17 percent GST on gold jewelry.
FBR officials informed the committee that out of 36,000 jewelers in the country, only 54 were on the active taxpayer’s list. They further apprised the committee of the stringent regulations on the import of gold and said that the regulations had led to its smuggling. The committee members expressed serious reservations over such a large number of unregistered jewelers.
Senator Farooq Hamid Naek said 137 out of 1000 infants in Pakistan passed away due to lack of proper nutrition and said they won’t let the government impose a tax on formula milk.
FBR officials said the use of formula milk had become a fashion and it was available in the market in the price range of Rs. 600/kg to Rs. 1400/kg. They pointed out that formula milk would be available at subsidized rates if bought on a doctor’s prescription.
FBR officials also informed that Track & Trace System to cover tobacco manufacturing would soon be extended for sugar, fertilizer, cement and beverages industry, and petroleum products.
Earlier in the meeting, the Drug Regulatory Authority of Pakistan (DRAP) representative informed the meeting that the prices of registered drugs would not increase despite the new GST regime. However, the committee was informed that prices of drugs of nutritional value would increase due to the 17 percent sales tax.
The meeting was attended by the Leader of the House in the Senate, Senators Dr Shezad Waseem, Zeeshan Khanzada, Farooq Hamid Naek, Saleem Mandviwalla, Sherry Rehman, Mohsin Aziz, Kamil Ali Agha, Musadik Malik, Dilawar Khan, Anwaar-ul-Haq Kakar, Faisal Subzwari and Faisal Saleem Rehman. Chairman Federal Board of Revenue (FBR), member FBR and senior officials of the attached departments also attended the meeting.
