Finance Bill 2020
Approves 53 recommendations in budget 2020-21
The Upper House of the Parliament on Wednesday unanimously adopted recommendations of the Senate Standing Committee on Finance Bill 2020, recommending 40 amendments and 53 general consensus recommendations to the Lower House. The Senate resumed its session on Wednesday with Chairman Sadiq Sanjrani in the chair.
The House unanimously adopted recommendations of the Senate’s Standing Committee on Finance on the Finance Bill 2020, containing the annual budget statement. The motion was moved by Senator Farooq Hamid Naek.
Earlier, the House unanimously passed a resolution demanding of the government to ensure writing of Khatim-un-Nabbiyeen with the name of Holy Prophet Hazrat Muhammad [Peace Be Upon Him] in the educational syllabus and official documents. The resolution was moved by Senator Muhstaq Ahmed.
Farooq Hamid Naek said the committee proposed forty amendments in the finance bill; besides, 53 general consensus recommendations.
The Senate unanimously adopted a series of recommendations for incorporation in the Finance Bill 2020-21. The recommendations were furnished by Chairman Standing Committee on Finance by Senator Farooq Hamid Naek.
The House recommended that salaries of government employees be enhanced at least 10 percent. The Senate recommended that the federal government should double the budget for education and health sector. It demanded that budget allocation for ministry of national health services must be enhanced to a minimum of five percent.
The Senate recommended granting of tax relief for the manufacturing and supply of Personal Protective Equipment. Budgetary allocations for online education and Higher Education Commission were also recommended by the House.
It demanded that 11 percent cut proposed on the share of provinces in the National Finance Commission award must be revised immediately. It was also recommended that more funds should be allocated for management of rain water reservoirs as well as construction of small dams.
The recommendations say that tobacco must be treated as a crop like wheat, maize, and sugarcane and must be exempted from taxes and duties. However, Federal Excise Duty on cigarettes should be enhanced as per World Health Organization guidelines. The House recommended that custom duties of raw material, essential finished goods and plant and machinery whose domestic alternative is available in the country should be reduced to zero. Furthermore, Customs duties of these items, having local alternatives, available, must be charged at double of the existing rates. Abolishment of all kinds of withholding tax, chargeable on cash transactions form banks has also been recommended by the Upper House.
The House recommended that recycling industry functioning at small levels should be exempted from sales tax. It recommended that funds should be allocated for improvement in the aviation sector and to upgrade airports across the country.
The Senate recommended that a realistic tax collection target should be set for the next fiscal year. It recommended to raise at least 50 percent in the Corona Stimulus Package for fertilizer subsidy, loan remission and other relief to the farmers in view of COVID-19 and locust challenges.
The House demanded to restore zero rated facility or slash general sales tax from 17 percent to 4 percent for textile export sector.
Minister for Industries and Production Hammad Azhar says the government has tried to minimize the impact of Covid-19 on the economy by pursuing a prudent strategy.
Winding up discussion on the Finance Bill 2020-21 in the Senate, he said that presenting a tax free budget while enhancing allocations for development as well as education and health budgets in the face of coronavirus shows the leadership of Prime Minister Imran Khan.
The minister said that the all the economic indicators were showing positive trends prior to the break out of the pandemic. He said, “We reduced the current account deficit by 73 percent, trade deficit 31 percent and fiscal deficit to 3.8 percent in the first nine months of current fiscal year.”
He said it is also for the first time that our primary surplus remained positive. During this period FBR collections were also witnessing 17 percent growth and non-tax revenue saw an increase of 134 percent. He said Foreign Direct Investment also doubled from one billion dollars to two billion dollars and refunds of Rs250 billion were also made to the businesses.
Sharing the main points of the next budget, the minister said that no new tax has been imposed rather a several taxes have been abolished. He said the custom duties on 1600 tariff lines of different raw materials have been abolished.
Over ten withholding taxes have also been waved off. He said 661 billion rupees have been set aside for the annual Public Sector Development Program. He said Balochistan has been given the biggest share in the PSDP followed by Sindh.
The minister categorically stated that the Federal government has not withheld the amounts of the provinces under the National Finance Commission.
The minister assured that the recommendations of the Upper House for the Finance Bill 2020-21 will be given due consideration.
Hammad Azhar said Pakistan’s ranking on ease of doing business improved due to prudent policies of the government. He said Pakistan complied with the majority of action plans of the Financial Action Task Force. He said 14 out of 27 points of FATF have so far been met.
The House was later prorogued. TLTP