ISLAMABAD - The Economic Coordination Committee (ECC) of the federal cabinet on Friday granted Rs20 billion tax exemptions for the import of equipment to be installed for the Lahore Orange Line Metro Train Project.
The ECC approved the proposal of the Planning, Development and Reform Division at the request of the Government of Punjab to grant exemptions from withholding tax beyond six per cent of the E&M contract price, and from tax/duties on import of equipment to be installed for the Lahore Orange Line Metro Train Project.
The Punjab government had sought Rs20 billion tax exemption on $1.6 billion Orange Line Metro Train Project.
The ECC was chaired by Federal Minister for Finance Ishaq Dar at the Prime Minister’s Office.
The ECC also decided that a similar dispensation would also be extended to the other rail-based mass transit projects in Karachi, Peshawar and Quetta at an appropriate time.
The ECC was informed that the Lahore Orange Line Metro Train Project has been made a part of the China-Pakistan Economic Corridor (CPEC) project along with rail-based mass transit projects in other provincial capitals at the recently concluded 6th Joint Cooperation Committee (JCC) meeting held in Beijing, China.
Earlier, the top economic decisions making body of the country in December could not approve the tax exemption for $1.6 billion Lahore Orange Line Metro Train Project due to the strong resistance from the bureaucracy.
Finance Minister Ishaq Dar had tried his level best to approve the summary.
However, Federal Board of Revenue (FBR) created hurdles in approving the summary, as project was not part of the CPEC at that time.
The FBR said that other provinces would also ask for similar tax concessions.
However, the Joint Cooperation Committee (JCC) on the CPEC has recently approved rail-based mass transit projects for all provincial capitals of the country including Lahore, Peshawar, Karachi and Quetta.
The Lahore Orange Line Metro Train Project has also been made part of the CPEC. Therefore, the ECC granted tax exemptions to the rail-based mass transit projects.
