The committee meeting presided over by Senator Farooq H Naek continued discussion on the Finance Bill 2019 on Thursday and during discussion on proposed sales tax on ginning sector, the Cotton Ginner Association urged the government not to impose the tax as it would have tickle down effect. The Member Inland Revenue stated, "We are banking on tax collection of Rs 250 billion from withdrawal of zero-rating while Rs 150 billion will be refunded."
The chairman Cotton Ginner Association appeared before the committee and demanded zero sales tax. However, the Member FBR expressed his revenue concerns. He said ginners cannot collect sales tax from spinners and deposit it to the Federal Board of Revenue (FBR). The FBR itself should collect this tax from the spinners, added the chairman of the Cotton Ginner Association.
The FBR said the tack and trace system on tobacco packing would be implemented from February 2020 and Federal Board of Revenue (FBR) is also in discussion with Azad Kashmir authorities for making changes in cigarette packing label and providing real time and they have agreed to proved. The Member IR added that a joint mechanism is also being evolved to ensure monitoring.
The Members FBR told the committee that local markets even in federal capital are full of imported cigarettes and those being sold at Rs 24 per packet whereas minimum price of legal cigarettes is not less than Rs 50 per packet. The government, he said, has decided to impose penalty between Rs 20,000 to Rs 100,000 on those who are selling cigarettes at lower prices. The committee, however, recommended that fine should be subject to the approval of the commissioner.
The members of the committee as well as chairman voiced their concerns on taxes imposed on essential commodities and stated that these would have direct bearing on the common man in the form of dearness.
The committee recommended to the National Assembly to withdraw proposed duty of Rs 25 on per bundle of cement from the Finance Bill. The finance committee decided to consider Asset Declaration Ordinance but it would not give recommendations. The committee chairman also pointed out that there is no definition of asset declaration in the law. "Your title in the law is asset declaration and there is no definition of it," he said.