National Assembly passes Finance Bill 2016-17 with certain amendments

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ISLAMABAD, JUNE 22 (APP): The National Assembly Wednesday
passed the Finance Bill 2016-17, with certain amendments,
providing legal cover to the budgetary proposals for the
upcoming financial year with a total outlay of over Rs4.8 trillion.

Following a 15-day discussion, the bill moved by Finance Minister Muhammad Ishaq Dar was passed by the lower house of parliament with a majority in a clause-by-clause reading on Wednesday.

The opposition members presented certain amendments to the financial bill which were rejected with majority of votes. Those who proposed amended included Dr Nafeesa Shah, Dr Arif Alvi, Sahibzada Yaqub, Ayesha Sayed, Dr Mehreen Razzaq, Naveed Qamar, Dr Azra Fazal and others.

Minister for Law and Justice Zahid Hamid on behalf of Minister for Finance Mohammad Ishaq Dar moved amendments proposed to the Finance bill by the treasury benches in the House.

Amendment was also inserted in the finance bill to revise salaries of parliamentarians including Speaker, Deputy Speaker NA and Chairman and Deputy Chairman Senate through gazette notifications. As many as 86 out of 139 recommendations forwarded by the Senate for incorporation in the Finance Bill 2016-17 were approved by the house which is acceptance of 62 percent proposals.

The Bill 2016-17 would be effective from July 1 this year after President Mamnoon Hussain signs it.

Apart from passing budget, the lower house of the parliament also approved 112 supplementary grants worth Rs 260.875 billion for
the outgoing fiscal year 2015-2016.

It is pertinent to mention here that the PML-N government on June
3, had presented the budget in the parliament with total outlay of Rs 4,894.9 billion, 10 percent higher than the previous budget of 2015-16.
According to the budget document, the resources availability during 2016-17 was estimated at Rs 4,442.0 billion against Rs 4,168.3 billion in the budget of 2015-16.

The net revenue receipt for 2016-17 had been estimated at Rs 2,779.7 billion indicating an increase of 12.8 percent over the budget estimates of 2015-16. The budget is focused on development agriculture and trade to promote growth and aims to develop energy sector besides maintaining fiscal discipline and reducing non-development expenditure.

Addressing the house Finance Minister Ishaq Dar said that National Finance Commission Award has no direct relevance with the
budget, saying that there has been progress to complete the NFC
award as soon as possible.

He said that the provinces were not fulfilling their responsibility to cover the subjects that were devolved to them according to 18th amendment and that is why the federation has to intervene.

Withholding taxes could not be withdrawn Dar said and refuted the information that ratio of direct tax has reached to 85 percent
and clarified that the direct taxation has increased from 38 percent
to 42.4 percent.

The finance minister said sharing prosperity was the common
narrative on the China Pakistan Economic Corridor (CPEC) and
rejected all the misleading conceptions some quarters were
propagating in this regard.

He said that it was our luck to have launched such projects,
which would bring us closer to many Central Asian countries
adding that Pakistan could not stop China from making investments
in any other country.

He said that there is dire need that we make CPEC successful.
He said the decisions taken in All Parties Conference about CPEC
would be implanted regarding the execution of projects. He said that
FBR was renegotiating Free Trade Agreement (FTA) with China
expressing that better results would come out of it.

He said that we have been following to have membership
of Organization of Economic Cooperation and Development (OECD)
that would help us to have access to information.

“We are in final stages of getting the membership” he said
adding that OECD authorities have informed us that when the Finance
bill is approved, the OECD would be in better position to
offer the membership. He said that the government accommodated
majority of the Senate recommendations in the finance bill and
the proposals by the National Assembly were also considered.

Earlier opposing the Finance bill, Dr Nefeesa Shah of
Pakistan Peoples Party (PPP) alleged that encroachment was being made
on tax collection of provinces.

She said the federation should make efforts to ensure
effectiveness in the tax collection. However, she said
federation was encroaching on sales tax collection of the provinces.
She said the Sindh government exceeded revenue target and it
has been achieving revenue targets for the last three years.

She said that tax amnesty scheme was introduced to
include around 400,000 new people into tax net but only 10,000
people could be attracted.

She said that concession was given to China in the Finance
bill and details of agreement signed with China should be shared.
She said they should be informed how we would benefit from
free trade agreement signed with China, Malaysia and Indonesia etc.

She said there was a dire need to protect our industry and
agri sector. She said that they should also be informed about LNG
and coal based power projects. Chinese banks were providing
commercial loans to these power projects which would
generate expensive electricity resulting in accumulation of circular debt.

Dr Arif Alvi of PTI said system of Federal Board of Revenue
(FBR) should be upgraded to broaden direct tax net in the country.
He said that the FBR was not working effectively due to
imposition of indirect taxes. Indirect taxation has made job
of FBR easy as no efforts was being made to collect revenue, he
added. He said Switzerland made International Asset Recovery Act in
2010 to return plunder or illegal stash amount.

Earlier it was being said that Pakistanis have over $ 200
billion in Swiss Banks, he said and added that no step was taken
to return back that amount.

Alvi said maximum black money was being invested in real
state industry adding that properties worth $ 7.5 billion were
purchased in Dubai during last three years. He claimed the
amount was illegally transferred to Dubai for purchasing the
properties. If these loopholes were plugged, it would help increase investment opportunities in the country, he said.

Abdul Wasim Khan of MQM said that indirect tax network was
being widened rather than direct tax. He said that withholding tax
should be abolished besides imposing direct tax on elite class.

He said tax amnesty scheme was launched to bring more people in
tax net but very limited people entered in the tax net. He
said salaried class were paying more tax than the elite and rich people.

He said Pakistan Steel Mills (PSM) was contributing tax to
the national exchequer. However, PSM which was considered to be a
backbone to the industry has been shut down, he added.

Speaking on the Finance Bill, Sahibzada Tariqullah
of Jamaat i Islami said that some NGOs were working against the country’s interest and integrity and questions why relief was being given to these NGOs.

He said tax net should be widened and more people should be
brought in the tax net. He also called for allocating more funds to under developed districts of the country to bring them at par with developed ones.

Tariqullah said that Rs 14,000 monthly salary to labour was
very meagre and urged to enhance it besides ensuring implementation of payment in letter and spirit.

Sheikh Rashid Ahmed of Awami Muslim League said Pakistan also fully supported China every where.He said unemployment was on the rise
in the country due to smuggling from India.

He said that it was the responsibility of the government to
protect and safeguard peoples’ interests. He said that rich were not paying taxes and only poor class were being overburdened.

Rashid said corruption was a big hurdle in progress and prosperity of the country and it needed to be eliminated.

Sayed Esa Noori of Balochistan National Party said Pakistan
has vast border with Afghanistan and Iran and called
for legalizing business in the border areas as it would
help discourage smuggling. He said that 90 per cent areas of Gwardar was still deprived of electricity and urged the government to resolve real issues of the people of Balcohistan.

He said that Balochistan was ignored in the budget and no
special relief was announced in the budget for the province.

Dr Azra Fazal of PPP said that fiscal responsibility and
debt limitation bill was skipped in the finance bill and it should be brought separately so that thorough debate could be carried out.

She said the Western Route of CPEC should be opened to benefit
the people of Balochistan particularly Gwadar. She said both China and Pakistan would be beneficiaries of Gwadar port and the Chinese
economy would be expanded.

Ayesha Gulalai of PTI said that corruption was main problem of the country and it was also affecting the growth rate. The country’s economic situation could not stabilize despite taking hefty loans, she said.
She said hefty amount was allocated in the budget for Temporarily Displaced People (TDPs) but no house was constructed to rehabilitate them. She said that tribal people rendered supreme sacrifices for the
country and proper attention should be given to them.

Asif Husnain of MQM said local government was not being empowered
in the country despite holding local bodies election around one year ago. He said the people issues would not be resolved till fully empowering the local government system.

Jamshid Dasti said southern Punjab and Khyber Pakhtunkhwa was
ignored in CPEC. He alleged that maximum projects were being set up in the developed areas.

He said that no direct tax was imposed on the rich and only
poor class was being over burdened on imposing new indirect taxes.

Shazia Marri of PPP said strengthening of federating units was
a must for a strong federation and urged for releasing of the already sanctioned amount for various projects in Sindh.

She called for withdrawal of duty on various items related
to education like pencils, notes books etc, suggested in the federal budget.

Sajid Nawaz of PTI called for strengthening of
institutions and elimination of corruption from departments. He said there was a dire need of construction of big hydel power projects in the country to get rid of power crisis.

Sher Akbar Khan of JI said no relief had been given in the
budget for poor segment of the society and criticised allocation of less amount for health and education sectors in the budget. He said less developed areas had been ignored in the budget.

Jorge Khalil of PML N said the PTI led government of KPK
had reduced budget of minorities in its budget and has allocated Rs 300 million to a religious seminary.

However, responding to the point raised by Jorge, PTI Chief
Whip Dr Shireen Mazari said that PTI chairman Imran Khan has already taken notice of it and directed the Chief Minister KPK Pervaiz Khattak to enhance it.