ISLAMABAD: Federal Minister for Finance Shaukat Tarin said on Friday that Saudi Arabia will provide a $3.6 billion facility for purchasing oil on deferred payments over a period of two years.
“Saudi Arabia has agreed $150 million credit on a monthly basis for providing oil facility on deferred payment. It will provide $3.6 billion in cash for two years for allowing Islamabad to purchase oil from anywhere for meeting its requirements,” Federal Minister for Finance and Revenues Shaukat Tarin confirmed when journalists asked him about the Saudi Oil Facility (SOF) on deferred payment after the inauguration of Track and Trace System at the production unit of Pakistan Tobacco Company (PTC) located in Jhelum on Friday.
When this scribe inquired about the finalisation of the Saudi Oil Facility, the minister replied that Saudi Arabia’s deal was done under which they would provide a $150 million credit facility on a monthly basis, so it would be around $3.6 billion facility for the next two years.
To another query when asked how Pakistani refineries would be able to utilise the full capacity of refining Saudi crude oil, the minister replied that they would provide a $150 million facility as cash on a monthly basis and then the government would purchase oil from anywhere. It is relevant to mention here that Pakistan had remained unable to fully utilize the Saudi Oil Facility (SOF) on deferred payment because most of our refineries were not able to refine the Saudi oil. These refineries were built to refine crude Brent varieties purchased from other Gulf countries.
Earlier, in his address on the inauguration of the much-awaited Track and Trace System installed to gauge real-time production of produced cigarette packs under one of the IMF conditions, the finance minister said that Pakistan’s tax-to-GDP ratio was hovering at 8 to 10 percent and it would have to increase to 20 percent of GDP. “If we would achieve growth of 6 to 8 percent on sustained basis, then we will be able to create two million jobs entering into market on per annum basis,” he added. He said that Pakistan’s 60 percent population was below 30 years of age and if they remained jobless, it could create chaos. He said that if the population dividends were not ensured, then it would result into disasters. He said that Pakistan had failed to improve its tax-to-GDP ratio mainly because vested interests in the country did not allow expansion in the narrowed tax base. He commended the efforts of chairman FBR and its team that they were using technology to broaden the tax base.
He said that in the Universal Self Assessment Scheme (USAS), third-party audits would be done. He said that the technology would be utilized to bring retailers into the tax net. Track and Trace would help achieve the ambition to bring more people into the tax net.
The minister said that the share of illicit cigarettes having share of Rs70 billion was causing losses and the government would expand track and trace for four to five more industries. He said the government would not be blackmailed by retail or any other lobby. He said that when he told Prime Minister Imran Khan that he would be going to Jhelum to inaugurate the Track and Trace system at the PTC factory, the premier got thrilled and promised to do a tweet on it today.
Shaukat Tarin said that there was no implementation plan to fix the economy since 1972 and the Planning Commission was destroyed. He said the Economic Advisory Council (EAC) was asked to make holistic plans for 14 different sectors of the economy. The prime minister’s vision was to make Pakistan on the pattern of State of Medina and it required money. It cannot occur until and unless we collect taxes, he added.
The Managing Director/CEO, Pakistan Tobacco Company, Syed Ali Akbar, said on the occasion that the formal sector was facing challenges of illicit cigarettes and it was causing a revenue loss of Rs70 billion on a per annum basis. He said that the track and trace would help if it would be enforced at retail levels. He said that they were investing on new categories and would be investing $40 million here at this plant. He said that they had exported $30 million worth of products to the Gulf States and neighboring regions.
According to the FBR’s announcement, the special ceremony was also attended by Chairman FBR Dr. Muhammad Ashfaq Ahmed along with Qaiser Iqbal, Member (IR Operations), and Tariq Sheikh, Project Director (TTS). The CEO of Pakistan Tobacco Company, Ali Khan, welcomed the chief guest and other dignitaries present on the occasion.
Federal Minister for Finance & Revenue in his speech congratulated the FBR for rolling out this significant project, which would help prevent leakage of revenue, under-reporting of production and sales of tobacco products and ensure proper payment of FED and Sales Tax on the manufacture and sale of the products.
“TTS is a very comprehensive and robust electronic monitoring system, which is a paradigm shift from the conventional physical monitoring system. It is believed that installation of the Track and Trace System (TTS) in the notified sectors would be a game-changer for improving revenue and curbing counterfeit products in the market,” the finance minister added.
While highlighting the persistent efforts of FBR for rolling out this project, the minister stated that it was heartening to see that the FBR had successfully issued a license and, subsequently, signed a contract with AJCL/Mittas/Authentix Consortium for the installation of the Track and Trace System (TTS) on 5th March 2021.
This system is to be developed, operated and maintained by the licensee for notified sectors, including tobacco products manufactured in and imported into Pakistan. For this purpose, the FBR was striving hard to implement the system for the last 12 years, but unfortunately, it resulted in five unsuccessful attempts. However, in its sixth attempt, the FBR has procured one of the best Track & Trace Systems (TTS) available after strenuous efforts of over a decade.