News Detail
Event Title: Senator Saleem MandviWalla, Chairman Senate Standing Committee on Finance and Revenue presiding over a meeting of the committee at Parliament House Islamabad
Event Date: 2025-06-16
The Senate Standing Committee on Finance and Revenue, chaired by Senator Saleem Mandviwalla, held its fourth consecutive session today in the Parliament House, to review the Finance Bill, 2025, which includes the Annual Budget Statement presented to the Upper House on June 10 under Article 73 of the Constitution.
The meeting was attended by Finance Minister Muhammad Aurangzeb, Senators Farooq Hamid Naek, Syed Shibli Faraz, Anusha Rehman Ahmad Khan, Mohsin Aziz, Ahmed Khan, Munzoor Ahmad, Mohammad Abdul Qadir, and senior officials from the Federal Board of Revenue (FBR) and other key departments.
Opening the session, Chairman Mandviwalla lauded the “diligence and active presence” of the Federal Minister for Finance, stating “The Minister’s consistent participation and valuable input during these sessions reflect the government’s commitment to transparent fiscal reforms.”
Continuing deliberations on the Sales Tax Provisions of the Finance Bill,2025, the committee delved into the clauses on “Offences, Penalties, and Punishment on Tax Fraud.” Senator Farooq H. Naek proposed multiple legal refinements, including:
* Reducing penalties for tax fraud from Rs 10 million to Rs 5 million
* Reducing the sentence from 10 years to 5 years
* Requiring the issuance of three separate notices before prosecution
* Mandating the High Court to decide tax appeals within 60 days
* Separating inquiry, investigation, and court trial phases
Senator Naek emphasized that a two-year sentence is already harsh for a businessman. Ten years is excessive. Penalties must be proportionate and not politicised, he added
Echoing this sentiment, Senator Shibli Faraz said: Tax laws must not be used for political victimisation.”
The Committee appreciated the valuable input of Senator Farooq Hamid Naek who through his extensive experience in legislation guided the committee clause by clause in the language and legal framework of the bill.
The committee alongside the Federal Minister for Finance and Revenue said that he will inform the Prime Minister of the committee's recommendations regarding this legislation. The committee believed that implementation of recommendations will make the real difference
The Committee approved a new clause for inspection of audit firms under the 2025 Bill. FBR officials explained that many audit firms are failing to meet international standards and merely "stamp papers."
Senator Mandviwalla remarked: Audit firms, conduct only 10 percent of audits—this is unacceptable.”
The new legislation proposes:
* Empowering the Audit Oversight Board to monitor audit firms
* Involving Chief Commissioners in referring cases to the Oversight Board
* Ensuring prior notice is issued before inspections
A contentious debate arose over FBR’s plan to outsource certain audit functions. While some supported controlled data access, others expressed concerns over taxpayer confidentiality.
The Committee maintained that *auditors cannot be held liable* if they are misled by fraudulent submissions from taxpayers.
Senator Anusha Rehman raised critical points about the regulation of e-commerce platforms emphasising not to burden individuals specifically ( Youth & Women) using online platforms for generating income, and to set a threshhold to register platforms doing business above a certain amount.
Market place online us no different frm market place offline and FBR should strive to register market places offline.
On the proposed e-billing system, Senator Mohsin Aziz noted “Malaysia began phased implementation three years ago. We must assess our readiness.”
Chairman Mandviwalla acknowledged the valuable suggestions of Senator Mohsin Aziz stating to bring written proposals for phased implementation of e-billing. Talking will not suffice.”
He said
The Committee examined the tax exemption policy for FATA/PATA, which will begin phasing out with a 10% GST in the next fiscal year—gradually increasing to 18%.
Senator Shibli Faraz asked pointed out What tangible benefits have tax exemptions brought to these regions? Where is the investment and employment?”
The Finance Minister is scheduled to brief the Committee on this issue in the next session.
The committee also discussed the “ Islamabad Capital Territory ( Tax on Service ) 2001, Provisions of the Finance Bill ,2005. It was discussed that as per the IMF bench mark “negative list of services” should also be developed.
While discussing the Public Finance Management Act, 2019 a major disclosure rocked the session, revealing billions held and invested by public sector entities which are not transferred to central treasury but invested by these entities for profit.
Senator Anusha Rehman stated that this leads to government borrowing its own money from banks and paying interest, while institutions make profit on public funds.”
The Committee directed the Establishment Division and Ministry of Finance to submit:
* Complete account details of all such institutions
* Lists of investments and profits earned
* Legal basis for withholding funds from the national treasury
The committee while discussing the Federal Excise Provisions of Fiance Bill, 2025 Approved Abolishing Federal Excise Duty (FED) on first purchase of immovable property
The Senate Committee will reconvene tomorrow, at 2:00 PM with the Finance Minister scheduled to address tax exemption policies and provide further clarity on institutional financial practices.