ISLAMABAD - The Senate’s Standing Committee on Finance on Thursday expressed concern over the deduction of Withholding Tax (WHT) from the accounts of people without informing them and sought details from the Federal Board of Revenue in this regard.
The committee, which met with Senator Saleem Mandviwalla in the chair, directed the FBR to provide details of deduction of the WHT, under section 138 and 140 of the Income Tax Ordinance, 2001.
The FBR was also asked to give details of how many people approached the courts, and how many, out of these, got their money back under the aforesaid section.
The FBR official told the committee that section 138 empowered the Board to recover the dues from bank accounts.
Senator Talha Mahmood and other members of the committee flayed the tax authorities, saying that by doing this, the FBR was not attracting the taxpayers but instead making them scared. “Through such measures, people do not come under the tax net,” they noted.
The committee also showed concern over the forced tax recovery of Rs 800 million by the FBR from the China Harbour Engineering Company Limited by attaching bank accounts.
To this the FBR official replied the Board recovered Rs 800 million from the company’s account against the demand of Rs6 billion.
The committee was further informed that the company had approached the court in this regard.
The committee also discussed the postponement of National Population Census, after the decision by the Council of Common Interests (CCI).
Chief Statistician Pakistan Bureau of Statistics (PBS) Asif Bajwa informed the government delayed the census due to the non-availability of army men, who were busy in operation Zarb-e-Azb.
He said the CCI had decided to hold census with the help of army. “An army jawan would accompany each enumerator not only for security purposes but also for collecting data on his own, which would be tallied with the data collected by the enumerator so that the process could be made more credible,” he elaborated.
Bajwa informed the committee there was no law that made it mandatory to hold census in the country after 10 years.
“We will finalise new dates for the census after consultation with the army, and then the same would be tabled before the CCI for approval,” he said, and added, “This time the census would be conducted on the same pattern on which it was held in 1998.”
The committee was told that two members from Khyber Pakhtunkhwa and Balochistan had been included in the Governing Council of the PBS to ensure that census were held in a transparent and credible manner.
The FBR official informed that around 5,300 people had availed the Voluntary Tax Compliance Scheme.
The representative of Pakistan Software Export Board told the committee that IT remittances had collapsed after the government imposed 8 percent tax on IT, adding, “Now the software companies are relocating to other countries, especially to UAE.”
To this, the FBR official replied that there was a proposal to bring the tax on IT to 2 percent in the Finance Bill for the next fiscal year.
The representative of State Bank of Pakistan informed the committee that the regulator issued instructions to the financial institutions on February 25 to continue import exports with Iran, under the Asian Clearing Union, after sanctions on Iran were lifted in January 2016. “Now the letter of credit (LC) can be opened in Euro,” he added.