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Saturday August 13, 2022

National Assembly passes Finance Bill 2022

In view of IMF’s demand, NA gives nod to impose petroleum levy by Rs50 per litre in a gradual manner

By Web Desk
June 29, 2022
Finance Minister Miftah Ismail speaks on the floor of the National Assembly in Islamabad, on June 10, 2022. — Twitter/NAofPakistan
Finance Minister Miftah Ismail speaks on the floor of the National Assembly in Islamabad, on June 10, 2022. — Twitter/NAofPakistan

ISLAMABAD: The National Assembly on Wednesday approved Finance Bill 2022 with a majority vote, bringing the country closer to the revival of the $6 billion loan programme as prior actions demanded by the International Monetary Fund were included in it.

The session was chaired by NA Speaker Raja Pervaiz Ashraf.

The motion to take up the budget was approved with a majority vote which led to the passage of Finance Bill 2022 after clause-by-clause reading as well as voice voting along with amendments.

NA gives nod to petroleum levy

In view of the IMF’s demand, the NA session gave its nod to impose the petroleum levy by Rs50 per litre in a gradual manner.

Minister of State for Finance Aisha Ghaus Pasha sought approval from the House to increase the petroleum levy which was granted immediately.

Finance Minister Miftah Ismail said that currently there is zero levy on the petroleum products in the country. Rs50 petroleum levy will not be imposed in one go.

Other amendments approved

  • Collecting sales tax from traders through electricity bills
  • 5% sales tax on services of software and IT consultants
  • Fixed income and sales tax worth Rs40,000 has been imposed on the gold shops that cover an area of less than 300 square feet

MQM-P stages walkout

MNA Sabir Kaim Khani, a member of MQM-P which is the coalition partner, chided the government and said that his constituency’s voters had sent him to the National Assembly to represent them.

“...it will not take me much time to shift benches. Railways have been destroyed in the last three months, but the minister for railways isn’t present in the hall,” he said while speaking on the floor of the house.

The lawmaker then added that the Pakistan International Airline (PIA) has shut its office in Hyderabad, while the roads were also damaged and no repair works were being done.

Another MQM-P MNA, Salahuddin, backed Kaim Khani and they staged a walkout.

Federal ministers Ayaz Sadiq and Murtaza Javed Abbasi tried to negotiate with the lawmakers, but Salahuddin said: “We have paid a heavy price for supporting you.”

IMF demands

The government presented the budget for the fiscal year 2022-23 on June 10 with a fiscal adjustment of Rs1.25 trillion, but the money lender did not accept it, leaving Pakistan with no other choice but to make further amendments.

Then on June 24, Finance Minister Mifath Ismail, in his budget winding-up speech, announced additional taxes that are expected to generate Rs466 billion, which helped the government reach an understanding with the IMF for the bailout package

The measures included bringing down the income tax slab for people earning from Rs50,000 to Rs100,000. They will be taxed at 2.5% and the rate moves up for the ones earning higher.

The government also agreed to the Fund’s demand of imposing a 1% poverty tax on those earning Rs150 million, 2% on those generating an income of Rs200 million, 3% on those earning more than 250 million, and 4% on the ones generating an income of Rs300 million or more than that.

These measures were in addition to the 10% super tax imposed on 13 big industries — cement, steel, banking, airlines, textile, automobile assembling, sugar mills, beverages, oil and gas, fertiliser, cigarettes, chemicals, and LNG terminals.