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  • Dec 25th, 2004
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The government has enhanced the excise duty from Rs 3 to Rs 5 per ton on registered minerals, negating the commitment it made in 1995 policy of gradually reducing taxes in the sector with the view of their ultimate abolition. Moreover, the government levy has also been extended to 38 more minerals by including them in the schedule, taking the total number of taxable items in this sector from 26 to 64.

A well-placed official source told Business Recorder here on Friday that the decision was taken in line with the government's most recent policy of broadening the tax base.

According to notification issued in this connection, a copy of which was made available to Business Recorder, the government has enhanced the levy by exercising the powers conferred to it by sub section (1) of section 3 of the Excise Duty on Minerals (Labour Welfare) Act, 1967.

And the 38 new entries were made in the schedule in the exercise of the powers conferred by section 10 of the same act, the notification added.

When approached for comments on the decision, the sources in Economic Affairs Division (EAD) told this correspondent the move would help the government in achieving Rs 580 billion target of tax collection for 2004-05.

But the officials of Pakistan Mineral Development Corporation (PMDC)-a subsidiary of the Ministry of Petroleum and Natural Resources-came out with different views.

Expressing their anger on the decision, they said that the government neither consulted the ministry before taking the decision nor they were informed about it after that.

PMDC officials were of the view that the decision would hurt the mineral sector that was already in bad condition due to lack of interest by the authorities for the last many years.

Moreover, they added, the decision was also a complete negation of the government's commitment of withdrawing all kinds of taxes on minerals to expedite the development of the sector.

Copyright Business Recorder, 2004

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