Islamabad, December 22, 2022 (PPI-OT):The Senate Finance and Revenue Committee on Thursday met under the Chairmanship of Senator Saleem Mandviwala to consider and finalize the recommendations on the Money Bill, the Tax Laws (Second amendment) Bill, 2022 laid in the house on 15 the December here at the Parliament House. The committee unanimously rejected the amendment to empower the Federal Government to bring about new schemes and modification in taxes, other than through the Money Bill.
The committee maintained that any modification required should be through legislation having representative from the public. Similarly, the committee also rejected the 390 Rs tax per kilogram on UN manufactured tobacco, however accepted the amendment of the increased rate of FED per thousand Cigarettes by 6,500 and 2050 Rs.
According to the Sales TAX 1990 the fix sales tax policy has been restored to previous practice of tax charges from retailers, other than those falling in tier-1, through their monthly electricity bills, at the rate of five percent where the monthly bill amount does not exceed rupees twenty thousand and at the rate of seven and half percent where the monthly bill amount exceeds the aforesaid amount. The committee unanimously endorsed the amended and remarked that it was also recommended previously but was not put in exercise.
In the special provision relating to payment of tax through electricity connections where the federal government or the board with the approval of the Minister in charge pursuant to the approval of the Economic Coordination Committee of the Cabinet may issue an income tax general order, the powers of the FBR have been withheld as recommended by the committee.
Similarly, the committee rejected the amendment that any income derived by Kuwait Foreign Trading Contracting and investment Company or Kuwait Investment Authority being dividend of the Pak Kuwait Investment Company in Pakistan, stating that this is disparity and if amendment is to be applied should be applied to all foreign companies.
The Senate Standing Committee on Finance and Revenue on Thursday reprimanded that the Amla Act serves as source of harassment for the Business community. “How come concealment of money perhaps to evade tax, is a terrorist act or a criminal offence” the committee reserved and further argued that until the offence cannot be established no notices under the Amla act should be issued.
It was also observed that the anti-money laundering act is inclusive of all the laws which parameters needs to be restricted and recommended to bring reformations in the Amla Act to protect the tax payer community. Senator Kamil Ali Agha recommended that a tax payer should be subject to various initiatives in order to welcome the Pakistani Nationals to pay taxes.
The Amla act restrains the public to enrol as a tax payer fearing the consequences of Amla notices and abnormal tax regimes. The FBR authorities apprised the committee that concealment of income exceeding 10 ml rupees comes under the ambit of criminal offense.
The directorate General intelligence and investigation (Inland Revenue) apprised on the status of ML investigations prosecutions and convictions which is 254, 113 and 2090 respectively with a crime proceed of 358,130 ml rps 238.342 ml Rs and fine of amounting to 0.5 PKR under AMLA, 2010 and 0.1 million under income tax ordinance, 2001.
The committee was apprised that the Pakistan Customs has been mandated under the Anti-Money Laundering Act. 2010 (Amla) to investigate /prosecute cases of Money Laundering arising from customs related predicate offences including smuggling, misdeclaration, fiscal, fraud, trade-based money laundering and violation of trade Policy and intellectual property Rights etc.
It was further apprised that it has also been mandated under the foreign exchange regulation act-1947 for effective enforcement of state Bank of Pakistan (SBPs) currency regulation regime. Under section 9 of the Amla 2010 customs authorities may issue notices to the business persons/entities against whom evidence /substantial proof on involvement in Money Laundering is available.
It was also apprised that notices, under section 9 of the anti-money laundering act, 2010(Amla) are issued only to the business-persons entities against whom sufficient evidence is available with the investigation officers after the approval by the supervisory officers. The committee held reservation on the serving of notices and said that the notices should be served only after an offense is established.
The meeting was attended by Senator Farooq Hamid Naek, Saadia Abbasi, and Mohsin Aziz. Faisal Saleem Rehman, Kamil Ali Agha, and Senator Dilawar Khan. Senior officials of the attached departments were also in attendance.
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Senate of Pakistan
H.No.7, Cat-II, G-8/2, Islamabad, Pakistan