ISLAMABAD - The Senate Standing Committee on Finance and Revenue has recommended the government to provide tax exemptions to the local industry as it has given under China Pakistan Economic Corridor (CPEC).

The Senate committee, which met under the chair of Senator Saleem Mandviwalla, has discussed the budget proposals of the senators and local industry representatives. The committee members showed concerns on granting tax exemptions to the projects under CPEC. “The local industry of the country will be shut down due to the tax exemptions given to CPEC projects. The government should also provide same exemptions to the local industry so they can compete with Chinese products,” said Mandviwalla.

Another committee member, Senator Talha Mahmood, also raised objection on granting tax exemptions to CPEC projects. He said that the government should not ignore the local industry by giving facilities to Chinese investors under CPEC projects. The committee proposed that the government should give tax exemptions to the local industry as like to the CPEC projects. Similarly, the committee has also recommended imposing income tax and enhancing Federal Excise Duty on ghee industries located in FATA (Federally Administered Tribal Areas) and PATA (Provincially Administered Tribal Areas).

The representatives of ghee industry informed the committee that industries in FATA and PATA are enjoying tax exemptions, which reduces their cost of production as against to industries of Khyber Pakhunkhawa. As many as 14 ghee mills out of total 26 had been closed in Khyber Pakhunkhawa due to high cost of production as compared to FATA and PATA. They demanded that the government either give them tax exemptions or to impose taxes on industries in FATA and PATA.

Meanwhile, Federal Board of Revenue (FBR) Chairman Dr Muhammad Irshad turned down the proposal of the dairy industry to give zero-rating for milk and its products. The representatives of the dairy industry demanded zero-rating on import of milk powder. They informed the committee that they many centres of milk pack would be closed in the country if the government does not provide tax incentives to them. The FBR chairman offered the milk industry to sit together to devise a mechanism, which should be acceptable for both the sides.

Senator Saleem Mandviwalla, in his remarks, said that FBR is protecting its corrupt officials. He further said that FBR has not taken any action against corrupt officials of Azad Kashmir. He claimed that Hyderabad chief commissioner received a land cruiser as a bribe. He said that FBR should not conduct the tax audit of a taxpayer for another year if the audit is conducted a year ago.