ISLAMABAD: Senate Standing Committee on Finance Member Senator Usman Saifullah regretted that in the presence of the Parliament, the issuance of SROs by the Federal Board of Revenue was illogical and illegal and the government should return the powers to its Constitutional guardian.
“It is the sole prerogative of the National Assembly to draft and promulgate new laws in the light of Constitution”.
Senate Standing Committee on Finance Member Senator Usman Saifullah expressed the views during an exclusive interview with Customs Today here.
Senator Usman Saifullah declared that increase in the rate of taxes in budget for 2014-15 would badly impact the common man, adding that it was yet to be gauged the trickledown effect of the hike in tax rate.
“The government must improve governance in the FBR to enable it come up to the challenges,” he suggested, adding that though the FBR chairman was a capable person, it seemed he did not have the liberty to make decision on part of the government.
He feared that 27 percent taxation would ultimately slowdown the economy, adding that the government should introduce electronic invoicing and cash registers which should be linked to the FBR.
The Senate Standing Committee member stressed the need for making easy the Tax language and documentation to facilitate the taxpayers, adding that Capital Gains Tax should be increased on trading in stock markets. “The current budget is fall short to bring about any positive change in the country’s financial condition,” he claimed, adding that it was right time for the government to take tough decisions. He also questioned where was the list of millionaires the government had claimed to have provided to the International Monetary Fund for broadening tax net? Senator Usman Saifullah declared that increase in the rate of taxes and electricity tariff would give rise to its theft.
“The government which has not been able to improve three prime public sector institutions i.e. PIA, Railways and Pakistan steel mill cannot be expected to solve the multifarious problems,” he commented, adding that why was the withholding tax withdrawn from steel scrap only? “There is no sign of any improvement; Look I am the only Senator from Islamabad but nobody bother to take me on board on Metro bus project,” Senator Usman Saifullah lamented, adding that the track for Metro Bus in Blue Area should have been laid at Green Area on Fazl Haq Road instead of Jinnah Avenue.
He pointed out that under the circumstance, the privatization of public sector institutions at throwaway prices would be of no use, adding that the government should instead improve their management.
He cited a World Bank’s report, saying that a corporation had to pay 27 kinds of taxes in Pakistan as compare to China where 15 kinds of taxes were levied. He suggested that the federal government should initiate dialogue with the provinces on implementation of agricultural tax, adding that currently the burden of 27 per cent taxes had been laid on those who were already paying taxes. “Steps have to be taken to speed up economic development,” the PPP Senator emphasized, adding that new companies were not being registered in the stock markets. “Look, 18 per cent of total stock market capital belongs to two families alone and If the Capital Gains Tax might have been increased, it may have merged with stock prices,” he said. He maintained that the government had not only failed to achieve its set targets for fiscal year 2013-14, but it had also been unable to act upon its own manifesto.
“A list of 3.5 million potential taxpayers was provided to the IMF for obtaining loans but currently the FBR is even denying the existence of any such list,” he pointed out. He regretted that if only half of the listed potential taxpayers were brought to the tax net, the revenue would be increased Rs160 billion.
Senator Usman Saifullah termed the Senate a symbol of the federation, saying that issues pertaining to the federation could be debated in the Senate in a better way.
The Senate Standing Committee member termed the subsidy for power sector much less, saying that increase in gas tariff in Khyber Pakhtunkhwa would leave the industry uncompetitive in the province.
Senator Usman Saifullah suggested that the government should support the sectors where lesser electricity was consumed and more labour was employed like textile. “Conversely, it should prioritise the sectors where more electricity is consumed and lesser labour is employed,” he pointed.
