ISLAMABAD: While opposing giving more powers to the finance minister and the Federal Board of Revenue (FBR) to make changes in the tax rates and in giving tax remissions, the Senate Standing Committee on Finance said that the federal cabinet should be the sole authority for deciding the tax matters.
The meeting of the Senate Standing Committee on Finance was held under the chairmanship of Senator Saleem Mandviwala to review the Finance Bill for Fiscal Year 2017-18 on Wednesday.
The committee opposed the proposal of giving more powers to the current finance minister or FBR to make changes in tax rates and concessions. Senator Kamil Ali Agha said that the particular legal permission should be sought through a constitutional amendment as it would not be legal to get it through the Finance Bill.
The committee recommended that all the tax matters should be decided by the federal cabinet and it could not be left to an individual or the FBR to make decisions. The committee said that the proposed amendment was a violation of the Supreme Court decision.
In a major decision, the Supreme Court had decided last year that all the tax matters, imposition, revision or remission could be imposed only after the decision of the federal cabinet. Simple approval from the prime minister or Economic Coordination Committee (ECC) was not enough, as it is the job of the federal cabinet to approve them.
After the decision, the government was taking approval from the federal cabinet on all the decisions made by cabinet committees, especially the Economic Coordination Committee of the cabinet. Some litigants had challenged the past decisions of the ECC and prayed to declare it ultra vires.
The committee was informed that FBR would be collecting 10 per cent import tax on the import of all the raw material imported by factories located in the Federally Administered Tribal Areas (FATA) and Provincially Administered Tribal Areas (PATA). They said it would provide a competitive environment to factories located in settled areas.
