Finance Bill-2022 sails through NA

Ag APP

ISLAMABAD: The long-awaited resumption of the IMF programme now seems very much in sight, as the National Assembly on Wednesday passed the Finance Bill, 2022 after incorporating the tax measures in line with the understanding reached with the Fund for receiving the bailout package.

The PML-N-led coalition government had presented Rs9.5 trillion federal budget for the fiscal year 2022-23 on June 10. But it later announced more tax revenue measures such as 10 per cent ‘super tax’ on large-scale industries and also withdrew some concessions, including the tax relief offered to the salaried class in their income tax, to secure the much-needed IMF loan. The additional taxes are expected to generate Rs466 billion.

The National Assembly passed the Finance Bill-2022 after clause by clause consideration and adopting certain amendments to it. Minister of State for Finance and Revenue Aisha Ghaus Pasha moved the motion for the consideration of the Finance Bill, 2022 to give effect to the financial proposals of the federal government for the year beginning on July 1, 2022.

The motion was passed with majority vote which led to the passage of Finance Bill-2022 after clause by clause reading and adopting amendments after due process of voting.

All amendments moved by the minister of state for finance and treasury lawmakers were adopted by the House while the amendments of opposition members including Javaria Zafar Aheer (PTI), Wajiha Qamar (PTI), Ramesh Kumar (PTI), Saira Bano (GDA), Maulana Abul Akbar Chitrali (MMAP) and an Independent MNA Mohsin Dawar were rejected by the House after voting.

The House held discussion on the Charged Expenditure included in Demands for Grants and Appropriations for the financial year ending on June 30, 2023. The House approved 131 demands for grants related to various departments and ministries.

During the debate on the Finance Bill, Aisha Ghaus Pasha maintained there had been no pressure from the IMF to integrate amendments to the budget, saying the changes had been made in the larger interest of the country. The amendments were made in such a way that the common man should not be affected, she said, adding the government had reduced taxes on the people having small incomes while increased tax on the higher income people.

She said the previous government had agreed on some amendments with the IMF that were being followed due to commitment of the state with the international monetary institution.

She said the super tax was being levied on the rich industrialists while small income segments had been given relief. During the process, the House approved the insertion of a new clause in the Bill to impose Rs50 per litre Petroleum Development Levy on all petroleum products.

Finance minister Miftah Ismail said the government had sought the permission to impose the levy of up to Rs50 but it had no intention to impose whole of the petroleum levy. Ismail said at present there was zero petroleum development levy on the petroleum products.

The National Assembly also approved the imposition of 10 per cent super tax on 13 large-scale industries. The tax measures would raise additional Rs465 billion in the revenues and help trimming the fiscal budget.

The government had initially set the target for the revenues of Federal Board of Revenue (FBR) at Rs 7.004 trillion for the fiscal year 2022-23 while due to the addition of new tax measures, the tax target has been increased to Rs 7.47 trillion.

Similarly, for other individuals whose annual income exceeds Rs150 million will be taxed at 1 per cent; for Rs200 million at 2 per cent; Rs250 million at 3 per cent; and Rs300 million at 4 per cent of their income. Furthermore, the government also reversed the decision of providing Rs47 billion relief to the lower- and middle-income salaried people. The tax exemption limit has been reversed to annual income of Rs600,000 from Rs1.2 million, whereas the fixed tax of Rs100 has been replaced with a 2.5 per cent tax for individuals earning between Rs600,000 and Rs1.2 million.

According to the bill, duty on the import of equipment for the film industry including projectors, loud speakers and 3D glasses was abolished.