The meeting of the Senate Special Committee on Causes of Decline in Tax Collection of Tobacco Sector was held on Tuesday. Convened by Senator Kalsoom Parveen; the meeting was attended by Senator Molana Abdul Ghafoor Haidri, Senator Muhammad Azam Khan Swati, Senator Hidayatullah, Senator Dilawar Khan, and senior officers of the Ministry of Commerce, Federal Board of Revenue (FBR) and Pakistan Tobacco Board.
The Committee lauded the performance of the FBR and said that if it continued with the same dedication Pakistan would be delivered of its economic crisis soon. Convenor Committee, Senator Kalsoom Parveen was of the view that at a critical time such as this, it was important that all sources of revenue be tapped. She condemned the gap that had been created in 2016-17 and said that this has caused a huge deficit worth PKR 60 to 70 billion. She said that this has not caused any losses to multi-nationals as they still procure 60 percent profits. However, local companies have been penalized as they are being charged an added tax of PKR 300. She further added that procuring taxes in advance was a good move; however, this would affect local manufacturers adversely.
Discussing lacunas of SRO 1149 (1)/2018 Chairman Committee stressed the need to explore the reasons for the decline. Senator Dilawar Khan was of the view that there might be a possibility that cost of production decreased at that time. He added that as per SRO. 1149 (1)/2018 multinationals could export GLT, whereas local manufacturers could not. He said that it was imperative that this SRO is revisited as this has discouraged exports.
Senator Kulsoom Parveen directed FBR to revisit the SRO and its clauses in consultation with all the stakeholders and said that she would once again arrange a sitting with the FBR to review this issue in detail.