ISLAMABAD: As members of the Senate’s Standing Committee on Finance had expressed resentment over the lack of the information shared with them regarding tax exemptions in Gwadar during an earlier meeting, the Federal Board of Revenue (FBR) on Friday informed that the exemption of income tax in Gwadar was for 20 years.
The senators on Wednesday had expressed displeasure after Maritime Affairs Secretary Rizwan Ahmed refused to share copies of contracts pertaining to Gwadar Port, terming them “confidential”. They had also outrightly rejected Gwadar Port’s “40 years tax exemption on specific names of companies, their contractors and sub-contractors”.
The committee had sought a list of contractors and sub-contractors working at Gwadar Port from the Ministry of Maritime Affairs in order to discuss related matters during an in-camera meeting.
Meanwhile, in Friday’s meeting, chaired by Senator Farooq Hamid Naek, the standing committee took up the Finance Bill 2020, containing the annual budget statement presented in the House last Friday. The review of the Income Tax Ordinance, 2001, and Federal, Excise Provisions of Finance Bill, 2020, was completed, whereas amendments recommended by the committee in the Public Finance Management Act 2019 were also carried out.
The committee approved an amendment in the Finance Bill 2020, wherein the exemption of taxes was sought for co-developers of the Special Economic Zones (SEZs).
It also deliberated upon the restriction on profit deduction on debt payable to associated enterprises. Agreements for the avoidance of double taxation and prevention of fiscal evasion were discussed in detail.
The committee appreciated the measures taken by the FBR to deal with the vast consequences of the coronavirus pandemic. They also lauded the omission of advance tax collection from dealers/commission agents etc. by market committees.
“This is an important measure to promote agriculture in the country,” the chair remarked.
Among other important decisions during the meeting, the committee approved the omission of advance tax on education-related expenses, increase in FED from 13pc to 25pc on caffeinated drinks, and 100pc FED on imported cigarettes, cheroots, cigarillos, cigars of tobacco and tobacco substitutes.
However, the committee strongly rejected the amendments to the ‘Taxpayers Profile, Appeal to Appellate Tribunal, Offences and Penalties and Power to enter and search premises. Clauses related to real-time access to information and databases were also disapproved on the occasion.
The meeting was attended by Senators Mohsin Aziz, Zeeshan Khanzada, Musadik Masood Malik, Mian Ateeq Sheikh, Talha Mehmood and Ayesha Raza Farooq.
