Finance committee summons economic team on soaring inflation rate

Says govt is taking measures to provide maximum relief to general public in response to The Economist's report

ISLAMABAD: While taking notice of soaring inflation rate in the country, the Senate Standing Committee on Finance and Revenue has summoned top officials of the government including the adviser to the Prime Minister on Finance and Revenue and State Bank of Pakistan (SBP) governor, secretary Finance and FBR chairman FBR in next meeting to explain the reasons behind price hike.

The committee meeting was held under the chair of Senator Talha Mahmood here on Thursday.

The parliamentary committee also discussed the decision to withdraw instructions to chief commissioners not to attach bank accounts without giving prior notice to owners. 

FBR Member Operations Qaiser Iqbal informed the committee that as per law, the tax commissioner was authorised for attaching bank accounts, which has a proper mechanism. 

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“The FBR does not attach an account without asking from the owner,” he said, further informing that former FBR chairman had retained the power of commissioner of attaching bank accounts with himself.

Later, the Senate’s committee decided to call the former chairman FBR in the next meeting to explain his position.

The committee members noted that FBR had misused the rules earlier and asked the government to maintain the previous position regarding this matter, noting that businesses are getting affecting due to the issuance of notices from the bureau. 

Cases related to the rebate of flour mills owners along with amounts due for the year 2015-18 were also discussed.

Furthermore, the committee also opposed an ordinance for making digital payments to the corporate sector. It was informed that an amended ordinance was introduced in September this year, which allowed making digital payment from Rs2,50,000 instead of cheques; however, the move was questioned as members opined that the move would create issues as the corporate sector would never accept it.

Meanwhile, in a statement on Thursday, the Ministry of Finance claimed that the government is taking a range of administrative, policy and relief measures to provide maximum relief to the general public.

While referring to the report by The Economist titled ‘Pakistan has been listed as the fourth highest in terms of inflation in the world’, the ministry stated that the magazine has reported in its latest edition a set of 43 countries without mentioning the exact comparison of Pakistan with similar economies.

Among many other measures, the statement said that in order to reduce the inflationary pressure, the government has discontinued borrowing from SBP.

During July to September of the current fiscal year (3MFY22), the government has returned Rs274.9 billion to SBP against the amount of Rs332.8 billion returned during the same period of last year. 

The government is also trying to balance the increase in petroleum prices by providing maximum relief in food commodities in order to balance the budget of the marginalised segments of the society wherein the food items constitute the 34.58 per cent of the overall household expenditure.

If we look at the international scenario, the producer price inflation is at 26-year high in China. The costly food prices are the biggest challenge for the governments all over the globe amid COVID-19, the statement said.

According to Food and Agricultural Organization (FAO), the global food prices have risen by 33pc in August, 2021 as compared to similar period last year. Brent oil has crossed the $85 per barrel recently. This is the highest price since 2018. Similarly, the average coal prices in last quarter were $167.52 per tonne as compared to $52 per ton last year. Therefore, inflation is a global challenge and Pakistan is not an exception, the statement concluded.

 

 

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1 COMMENT

  1. Government must be asked as to what have they done in the past three years to increase the production of pulses and chickpeas and also edible oil seeds as this could have had a big impact on the prices of these commodities and saved us considerable import bill. Growing tea plantations at home is another initiative which ought to have been taken!!

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