ISLAMABAD  -  The Senate Standing Committee on Finance and Revenue on Wednesday addressed a series of pressing matters of public importance, with an emphasis on tax policy, banking regulations, and economic governance.

The committee was convened under the chairmanship of Senator Saleem Mandviwalla at the Parliament House. Key discussions included the contentious 10 percent levy on transport and businesses across Pakistan and Iran, raised by Senator Manzoor Ahmad Kakar in a Senate session on September 9, 2024. The committee resolved to report to the house that the issue may be referred to the Standing Committee on Communications, noting that the levy, imposed with federal government approval, does not pertain to the FBR. While FBR officials emphasised that this specific tax or duty is not their responsibility, Senator Kakar raised concerns that Pakistani trucks were being unfairly taxed, with over 600 trucks currently parked due to levy. The committee agreed to forward the matter to Communications Committee for further deliberation. The committee also addressed a Starred Question by Senator Mohsin Aziz, concerning the fee collected by FBR for Point of Sale (POS) services and its utilisation. The FBR chairman confirmed a new policy to penalise businesses issuing fake POS receipts, with a fine of Rs5 lac and the closure of shops involved in such practices. Senator Aziz highlighted weaknesses in enforcement, with some fake receipts circulating in the market, including a bill in Islamabad marked “tentative”. The FBR chairman acknowledged the issue and assured that enforcement measures would be strengthened soon. Another important issue discussed was Islamic banking in Pakistan, raised by Senator Farooq Hamid Naek, who pointed out that full implementation of Islamic banking is set for 2027, yet progress has been slow. The deputy governor of the State Bank of Pakistan (SBP) emphasised the need for continued deliberation on Islamic banking and assured the committee that several banks are actively working towards compliance. A separate meeting will be scheduled to focus on the abolition of interest and provide a detailed briefing on Islamic banking practices. A key briefing by the SBP highlighted the performance of banking branches in smaller provinces, revealing that as of June 30, 2024, there are 3,334 banking branches operating in Balochistan, Khyber Pakhtunkhwa, Azad Jammu and Kashmir, and Gilgit-Baltistan, accounting for 20 percent of the total nationwide branches. Additionally, 199 branches of microfinance banks are serving these regions, representing 13 percent of the country’s total microfinance network.

The committee also deferred discussions on a briefing by the Securities and Exchange Commission of Pakistan (SECP) regarding the role and functions of its Policy Board, on their request.

Another pressing issue discussed was the problem of fake currency dispensed from ATMs. Senator Kakar raised a concern regarding a young man who received counterfeit Rs5,000 notes from an ATM. The CEO of Allied Bank of Pakistan assured the committee that security measures were being enhanced to address this issue.

The meeting was attended by Senators Farooq Hamid Naek, Mohsin Aziz, Syed Shibli Faraz, Anusha Rahman Ahmad Khan, Danesh Kumar, Munzoor Ahmed, and Syed Faisal Ali Subzwari.