Senator Faisal Vawda on Thursday claimed that most parliamentarians own smuggled vehicles.
He said this during a meeting of the Senate Standing Committee on Finance and Revenue today which was chaired by Senator Saleem Mandviwala.
The meeting reviewed key tax proposals in the Finance Bill 2024.
Discussing the government proposal to impose a 20 percent Federal Excise Duty (FED) on juices and 18 percent General Sales Tax (GST), Chairman Federal Board of Revenue (FBR) Amjad Zubair Tiwana informed the committee that these taxes were suggested by the Ministry of Industries and Production, not the FBR.
Senator Vawda criticized the new budget taxes, arguing that they have negatively impacted Pakistan’s property market. He further accused the International Monetary Fund of pushing for these destructive changes.
Chairman FBR addressed some of the panel’s concerns, explaining that the salaried class is facing taxes up to 35 percent, and the non-salaried class is up to 45 percent. In the property sector, filers face a 15 percent tax rate, while non-filers will be taxed at 45 percent. Tiwana defended these rates as fair.
Elsewhere, the committee approved an 18 percent sales tax on nicotine pouches and duties on importing e-cigarettes.
The Senate committee also approved the government’s proposal to seal shops selling non-duty-paid cigarettes. Chairman FBR said formal sector cigarette production had decreased by 40 percent, although overall smoking had not declined.
Senator Salim Mandviwala expressed concerns about the IMF’s understanding of the inflationary impact of such widespread taxation and questioned Chairman FBR’s awareness of inflation rates resulting from increased taxes. Chairman FBR was unable to confirm this, only commenting that FBR revenues would increase as a result.
The committee also reviewed the issues facing the automobile industry. The government introduced a new auto policy for 2021-26, and private car companies briefed on a Rs. 100 million investment in hybrid and electric vehicles. However, GST exemptions on 740 items were withdrawn. Vawda seemed irked by this withdrawal of tax exemptions, terming it “criminal negligence” and accused the government of sabotaging investments.
Vawda further alleged that such policy changes are hurting investments and that the SIFC policy is being sabotaged. He called for strict action and demanded that the Finance Minister, Industries Minister, and Chairman FBR be summoned to the next meeting to address these issues.
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