After all the hype and NAB cases, better sense seems to have prevailed as the government has reportedly shown its inability to review the power purchase agreements (PPAs) made with the independent power producers (IPPs) in the past due to the sovereign guarantees extended against the said agreements, a media report said.
Reviewing the agreements with IPPs is not possible as the government has extended sovereign guarantees and if the government goes against it and starts reviewing the PPAs, it will have to face legal repercussions at the international level, the prime minister was quoted as saying during a recent meeting with the business community. The prime minister was responding to the assertion of business tycoon Aqeel Dhedhi who had raised the issue of power sector inefficiencies owing to which the circular debt has increased to Rs 1.4 trillion. Dhedhi had pointed out that the power tariff was at a higher side and urged the prime minister to start reviewing the PPAs with the IPPs.
Dhedhi also expressed concerns that the government delays payment of refunds worth Rs 200 billion to the business community as it consumes the amount against other heads, such as financing the public sector entities (PSEs) which are running in a loss since long. He further remarked that the refunds amount is also spent in offloading the curricular debt.
Separately, in a meeting of the representatives of FPCCI and APTMA with the government’s economic team, Adviser to PM on Finance Dr Hafeez Shaikh agreed to carry out the audit of the business accounts once in three years. Earlier in the federal budget tabled in parliament, the financial wizards of the sitting government had proposed the audit of the business accounts every year. The announcement had irked the business community. However, in the meeting, Sheikh agreed to carry out the audit of business accounts once in three years. The meeting also approved the demand of the business community to develop a criteria in which a person is not repeatedly selected for audit without any definite information about tax evasion.
In order to facilitate the business community, FBR Chairman Shabbar Zaidi assured the meeting that a new system of refund will be introduced to issue refund to the exporters at the time of export. The meeting agreed that no action will be taken against the taxpayers on the basis of any wrong information with respect to the CNIC. However, the condition of CNIC, for invoice, will continue with an object to document the economy. Regarding the commercial imports, the meeting approved the proposal of the business community to do away with presumptive tax on commercial imports.
