PAC slams FBR over ‘sweet deal’ for sugar importers

ISLAMABAD: The Public Accounts Committee (PAC) has raised concerns over the Federal Board of Revenue’s (FBR) decision to grant significant tax exemptions on sugar imports, questioning whether it unfairly benefits specific private interests.

The PAC also ordered the recovery of Rs94 million in unapproved bonuses paid by the National Telecommunication Corporation (NTC), which also spent Rs5.6bn without federal approval and illegally hired 14 employees in violation of recruitment rules. The PAC meeting presided over by its Chairman Junaid Akbar expressed strong concern over the tax relief to private importers. The exemption reportedly includes reducing the general sales tax from 18pc to a mere 0.25pc and waiving the 3pc value-added tax on 500,000 metric tonnes of imported sugar. “The FBR seems to have attempted to favour a particular group through this SRO,” observed PAC member Riaz Fatyana.

Terming the move as “economic favoritism at the cost of public,” PAC member Sanaaullah Mastikhel termed it “a daylight robbery.” Moeen Aamir also criticized the recurring tax concessions in sugar sector. PAC Chairman Junaid Akbar announced that both the FBR Chairman and Secretary Commerce have been summoned to the next session to explain the rationale and beneficiaries behind the SRO. “This is institutional exploitation,” said Mastikhel. “We need to take decisive action before this trend becomes irreversible.”

While examining the audit para related to the Ministry of Information Technology, the Public Accounts Committee expressed serious concern over significant delays in the execution of an $88 million IT Park project in Islamabad, originally financed through a loan from the Korean Exim Bank.

Officials of the Auditor General of Pakistan said the project, meant to be completed by December 2022, has not yet even commenced, leading to losses of nearly $88.7 million. Despite approvals and funding, the physical infrastructure remains non-existent, sparking outrage among committee members. Sanaullah Mastikhel termed ‘accused’ those responsible of “inflicting a Rs13 billion blow to Pakistan.” He demanded accountability for the years long delays and asked why no tangible progress had been made despite the passage of time and availability of foreign funding.

Ministry officials assured that the Islamabad IT Park project would be relaunched by October after delays due to COVID-19. However, PAC Chairman Junaid Akbar demanded accountability for the lost time and summoned a progress report within a month. The committee also grilled NTC over Rs5.6 billion expenditure without federal approval, noting the corporation’s failure to get budget approvals and provide financial records for three years.

The IT secretary acknowledged procedural lapses, assuring rectification, but PAC Chairman Junaid Akbar expressed skepticism. The committee grilled NTC over financial secrecy and irregularities, with members questioning the violation of rules. The PAC directed the IT secretary to identify those responsible and submit a report. It also referred the issue of 14 irregular appointments to a sub-committee headed by Syed Naveed Qamar for further examination.

The PAC expressed strong dissatisfaction over NAB’s premature closure of an inquiry into NTC’s financial irregularities, questioning the unusually short six-month timeline. The committee also grilled NTC over Rs94 million in unauthorized bonuses, instructing recovery of the amount within a month.