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Event Title: Senate Standing Committee on Commerce and Textile

Event Date: 2019-10-22

Senate Standing Committee on Commerce and Textile in its meeting on Tuesday discussed the issue of imposition of taxes on import of Apple from districts Taftan and Chaghi in Balochistan giving way to smuggling of Apple fruit. The mover Senator Kauda Babar told the committee that this problem is arising mainly due to absence of quarantine offices who can streamline the process of import through proper taxation. Representatives from customs and food security department told the committee that the quarantine act was in place since 1976 but wasn’t being implemented but since 2017 it’s been made mandatory and new draft will be brought to cabinet soon to curb smuggling of Apple from Iran and pave ways for legal import and issuance of import permit.

The meeting was held under the chairmanship of Senator Mirza Muhammad Afridi here at the Parliament House on Tuesday and was attended among others by Leader of the House Senator Shibli Faraz, Senators Nuzhat Sadiq, Maulana Atta ur Rehman, Muhammad Tahir Bizenjo, Ahmed Khan, Kahuda Babar, Ghous Bakhsh Niazi, Rana Mehmood ul Hassan, Adviser to Prime Minister on Commerce and Textile Abdur Razzak Dawood, Secretary Commerce, senior officials from FBR, Customs and The adviser told the committee that eradicating the menace of smuggling is the goal of the government and steps are being taken to achieve the same. The adviser suggested holding a meeting with the Quetta Chamber of Commerce to resolve these issues and address the grievances of importers. Similarly while discussing the matter of import of onions and tomatoes the same issue was raised. The committee observed that prohibiting import of onions and tomatoes has not strengthened our farmers and has not helped in reducing prices as otherwise claimed. The commute was assured by Secretary Commerce that ask that is required will be done to address the issue. The committee recommended earliest possible appointment of quarantine officers in Balochistan to curb smuggling and support legal import.

While discussing allowing import of re-rollable scrap, mutilation of scrap and petroleum products like white spirit and hydrocarbon the committee was told that the restriction on import on three containers of an importer was due to the dispute in whether the contents of the containers qualify as scrap or not. Chief Collector Balochistan told the meeting that the case has been sent to court and will be decided accordingly. A sub-committee was constituted to investigate the matter as well as see the issue of smuggling on broader perspective to be headed by Senator Ahmed Khan.

The Committee also discussed the matter of problems faced by local manufacturers, spinners, weavers, traders and exporters with regard to input tax, GST mechanism for local turnover tax, ID card payment issues and the additional 10% tax imposed on traders as well as status of refunds under new system and problems in submission of annexure-H. Member FBR told the meeting that FBR holds a meeting every Monday with all five sectors of textile industry to address their problems on a regular basis. HE said that there are problems in filing of Annexure H but people are learning. He also told that 561 refund claims of five sectors were received till yesterday morning and  287 were processed and cleared last week.

The Committee was assured by Member FBR that FBR is willing to sit with all association representatives and manufacturers/exporters etc to resolve their issues regarding inspection teams coming to outlets and not headquarters, giving time and assistance for becoming part of the integrated scanning mechanism and revision of sales tax percentage. This system will help consumers check if the taxes they pay are transferred to the government or not. The Committee was told that only 41,000 people are filing sales tax in the country while the number of commercial activity holders is much higher and these steps in documentation of economy will encourage more and more people to get themselves registered.

The committee also decided to put on agenda the issue of under invoicing and hold a detailed briefing on the issue which can harm our FATF standing, our own Industry as well as Revenue generation.