Latest news with #NationalAssemblyStandingCommitteeonFinanceandRevenue
Business Recorder
5 days ago
- Business
- Business Recorder
Enterprises in SEZs, STZs: NA panel recommends capping tax exemptions
ISLAMABAD: The National Assembly Standing Committee on Finance and Revenue on Monday recommended a budget proposal of the government regarding capping the tax exemptions to enterprises in Special Economic Zones (SEZs) and Special Technology Zones (STZs) — a condition of the International Monetary Fund (IMF), at the earlier of tax year 2035 or the completion of the 10 year period. The committee which met with Naveed Qamar in the chair also gave nod to the budgetary proposals of tax on pension income exceeding Rs10 million for individuals under the age of 70. Federal Minister for Finance and Revenue Muhammad Aurangzeb told the committee that tax exemptions are not economically sustainable. The SEZs already enjoying them were not productive as per the desired results. Authority says Pakistan's new Special Technology Zone will boost tech exports by $350mn The Federal Board of Revenue (FBR) chairman said that a sunset clause for SEZs and STZs are included in the finance bill. He said that IMF was stressing to limit this tax exemption for SEZs and STZs to 2027; however, after hectic efforts the deadline was extended to 2035. The committee members raised serious concerns over the move, while saying that it would discourage the investors and not a single dollar investment would be brought to these zones. However, the committee gave its nod after it was told that it was an IMF benchmark and needed to be fulfilled. The committee gave its nod for another IMF-backed proposal by removing the distinction between Table-I and II, all Non-Profit Organizations (NPOs) are now subject to standard compliance requirements to qualify for 100 percent tax credit. This ensures better oversight, reduces misuse of blanket exemptions and align tax benefit with clearly defined regulatory conditions, the FBR added. Regarding the rate deduction for payment through digital means and cash on delivery, the FBR informed the committee that the measures is expected to generate around Rs59 billion. However, instead of the current proposed different rates of levy ranging 1-2 percent, the Finance Ministry informed the committee that a single levy would be proposed after consultations and the committee would be informed accordingly. The committee also gave its nod to the budgetary proposals of tax on pension income exceeding Rs10 million for individuals under the age of 70. Tax at five percent rate proposed on pension income exceeding Rs10 million for individuals less than 70- years old for high earnings pensioners to broaden the tax base. Talking about FBR transformation plan interventions (already approved by the Cabinet), the FBR chairman summarised it as war on significant economic transactions by non-filers and filers without resources, financial disclosures for high value translations, conditions access to financial transactions, use of technology to enhance compliance, data sharing for risk based enforcement and expanded audit capacity with confidentiality safeguards. Copyright Business Recorder, 2025
Business Recorder
5 days ago
- Business
- Business Recorder
No increase in PDL: Consumers to bear brunt of global oil price hike
ISLAMABAD: The government will not increase the petroleum development levy (PDL), but pass on the impact of increase in oil prices, as a result of the ongoing conflict in the region directly to consumers. This was stated by Secretary Finance while briefing the National Assembly Standing Committee on Finance and Revenue which met with Naveed Qamar in the chair here on Monday. The government has targeted to collect Rs1.486 trillion from PDL in fiscal year 2025-26. Finance Minister Aurangzeb also endorsed secretary finance's statement while saying that they are very decisive in this regard and not going to wait for the decision to be made. We did this yesterday, he added. Hike in petrol, diesel prices announced Amid geopolitical tension in the Middle East, former energy minister Omar Ayub Khan warned that the ongoing Iran-Israel conflict could disrupt global oil supply routes, particularly through the Strait of Hormuz, driving up international prices and inflating Pakistan's current account and fiscal deficits. 'Iran is the world's sixth-largest oil producer—any disruption will hit us hard,' he cautioned. Aurangzeb confirmed that the prime minister has formed a high-level committee to assess the situation. The committee chaired by finance minister reviewed the country's petroleum reserves and pricing in light of escalating tensions in the Middle East following the recent Israeli strikes on Iran. The meeting, held in Islamabad, examined the impact of fluctuating global oil prices driven by the geopolitical developments in the region. Officials from the Ministry of Finance and Petroleum Division were in attendance. According to a statement issued by the Ministry of Finance, the committee expressed satisfaction over the current availability of petroleum products, stating that the country holds sufficient reserves and faces no immediate threat of a supply crisis. However, the committee stressed the need for vigilant monitoring of international developments and their potential economic repercussions. In view of the evolving situation, a working group has been formed to assess market conditions on a daily basis. 'The committee will convene on a weekly basis and present its recommendations to the prime minister,' the statement said, adding that the Petroleum Division has been assigned the role of secretariat to facilitate timely coordination and reporting. The secretary finance told the committee that government borrowing has decreased to Rs1.32 trillion compared to Rs4.22 trillion during the same period last fiscal year showing a decline of Rs2.9 trillion. Replying to another question regarding pay and pension of armed forces, the secretary finance told the committee that for fiscal year 2026, pay is Rs846 billion, of which, Rs363.78 billion is basic while Rs482.22 billion are allowances. Pension expenditure for fiscal year 2026 is Rs742 billion. The secretary finance told the committee that significant change in government debt securities yield curve between July 2024 and June 2025 reflects a positive market sentiment, driven by effective policy measures and improved macroeconomic fundamentals. Sharp declines in short-term yields — such as a 9.44 percentage point drop in the 1-month tenor and 9.05 points in the 3-month, 7.79 percent in one year, 3.53 percent in five year and 1.92 percent in 10 year, signal successful inflation management, achieved through coordinated fiscal consolidation resulting in declining interest rate. Copyright Business Recorder, 2025
Business Recorder
01-05-2025
- Business
- Business Recorder
Budget proposals: Independent experts evaluating: Aurangzeb
ISLAMABAD: Finance Minister Muhammad Aurangzeb has said that the government has engaged independent experts/ analysts to evaluate budget 2025-26 proposals received from business and trade. Sharing update on federal budget (2025-26) from Karachi, Finance Minister informed National Assembly Standing Committee on Finance and Revenue on Wednesday that over 95 percent of the budget proposals have been received from business community. The independent analysts have been engaged to analyse the budget proposals. The tax policy would be framed by the newly established unit at Ministry of Finance in future. Director General of Tax Policy Unit would report to the Finance Minister, he said. FY26 Budget proposals: Businesses urge govt to gradually reduce GST rate Minister Aurangzeb participated in the NA Panel meeting virtually from Karachi and briefed the committee about his recent visit to Washington DC and attending more than 70 meetings with multilateral, bilateral creditors, counterpart ministers, representatives of international credit rating agencies. During his visit to US, three messages were received from donors/ agencies: Firstly, continuation of structural reforms and policies. Secondly, Pakistan should remain stay on course on economic front. Thirdly, consistency in policy reforms, he added. At the outset, the Federal Minister for Finance briefed the Committee on his US visit, meetings with high level delegates and the upcoming Budget. The Chairman expressed his gratitude, stating that this was a significant development, as it marked the first time that the Standing Committee would formally deliberate on the budget. He added that, in the past, budget discussions were largely confined to the Assembly session and often detached from the detailed matters. Copyright Business Recorder, 2025
