Hafeez lets out steam on Senators
ISLAMABAD: Finance Minister Abdul Hafeez Shaikh accused the members of a Senate committee on Monday of having a tendency to reject taxes that could be imposed on them and proposing others that did not affect them.
Speaking at the end of the first day of the Senate Standing Committee on Finance’s meeting on the draft bill on reformed general sales tax (RGST), he said taxes should be levied across the board.
“There are so many powerful people in Pakistan who are attached with some kind of business or the other. If this is the case then this means that the government is not able to levy tax on them,” he said.
The minister, who came almost at the end of the meeting, indirectly criticised members of the committee for proposing alternative taxation measures, saying it was irrelevant what a tax was imposed on; the important part was that support for any taxation measure meant support for taxes in principle.
Mr Shaikh said it had been portrayed through the media that the government had introduced a new tax.
“This is not the fact. The GST law has been there for more than 20 years. We are just introducing reforms in it.”
He said all previous governments, both secular and religious, had failed to increase the tax-to-GDP ratio.
“In every regime, including military, we have not been able to increase taxes.”
However, he admitted the flood surcharge was a new tax. “We admit that this one-time tax of 10 per cent surcharge on well-off people would lead to additional revenue required for the reconstruction,” he said.
In reply to an apprehension about an increase in corruption in the payment of refunds, he said he was not sure about it, but the value-added tax was not a new model and was in operation in almost 140 countries.
The minister parried a question by Senator Kulsoom Perveen about a delay in convening a meeting of the Planning Commission to allocate funds for the agreed development projects in Balochistan.
Senator Talha Mehmood alleged that revision of the Afghan Transit Trade Agreement would destroy the country’s economy.
When Ilays Bilour of the ANP said a proposed reduction in the duty of five oil companies would cost the national exchequer about Rs1 billion, the finance minister replied that the decision might have been taken in national interest.