Senate body for mechanism to issue new currency notes

ISLAMABAD: The Senate Standing Committee on Finance on Wednesday suggested the government to make legislation for the mechanism of issuing new currency notes to the public, as a strong mafia is working in the sector selling the notes at exorbitant rates.

Senator Saleem Mandviwalla while chairing the meeting said, “State Bank of Pakistan should evolve effective mechanism for issuing new currency notes from the banks instead of open market. A strong mafia is in the market that is selling the fresh notes at exorbitant rates to the general people.”

Senator Kamil Ali Agha said that selling currency notes is a big business and dealers are selling at 12 percent interest rate. Agha also blamed banks for giving certain amount of quota of fresh notes to the dealers.

The committee noted that the general public do not get the new notes from the banks on Eid and it is abundantly available in open market at higher rates and the central bank has failed in facilitating the people in this regard.

Deputy Governor SBP informed the committee that demand of fresh notes have increased this year as compared to the previous years. He further said that SBP had issued new notes worth of Rs68 billion in the month of Ramazan. He added that SBP had introduced SMS service for issuance of fresh currency notes to the general public.

Earlier, Chairman Federal Board of Revenue (FBR) Nisar Khan informed the committee that government had surpassed the revenue collection target of Rs3104 billion set for the last financial year, as collection gone to Rs3130 billion.

He further said that tax collection has shown an increase of 20 percent in fiscal year 2015-16 as against collection of Rs2589.9 billion of the preceding year 2014-15. Giving further details, he said that direct taxes have recorded growth of 15.3 percent, General Sales Tax 21.7pc, Federal Excise Duty 17.4 pc and custom duties have shown increase of 32.6 percent in the previous financial year.

Nisar has expressed hope to meet the tax collection target of Rs3621 billion set for the ongoing financial year. He informed that FBR had issued 212 SROs in last two financial years, in which 97 are related to the income tax, 53 are of General Sales Tax, 11 of FED and 51 of custom duty.

He informed the Senate’s committee that FBR is recruiting around 700 officials through Federal Public Service Commission (FPSC).