RECORDER REPORT

ISLAMABAD: The government has decided that a crackdown in collaboration with provincial governments would be launched against sugar mills involved in hoarding of sugar for profiteering which led to a considerable increase in the price of sugar in the domestic market. This was stated by Minister of States for Revenue Hammad Azhar on Monday while briefing the Special Committee on Agriculture, chaired by Speaker National Assembly Asad Qaiser. “The federal government in collaboration with provinces and their minister will launch a crackdown against hoarding of sugar in sugar mills immediately after the budget,” he said. The prices of sugar in the local market have increased considerably due to the impact of GST increase in sugar because of hoarding. The impact of GST increase on sugar from 8 percent to 17 percent would increase the price of sugar by Rs 3.64 per kg; however, increase in price is much more than this.

The minister said that the government has decided to review proposed powers to Federal Board of Revenue (FBR) Commissioner Inland Revenue to enter and search residential premises and houses on the basis of information of undeclared gold, bearer security or foreign currency.

A new sub-section 6-A was included which reads that “the Commissioner shall, subject to the condition as may be prescribed, raid any premises where there is reliable information of undeclared gold, bearer security or foreign currency and confiscate the same in order to enforce any provision of this Ordinance.”

The proposed powers to FBR commissioners were opposed by the Senate Standing Committee on Finance as well. “We are reviewing this proposal,” he added.

The minister of state for revenue also stated that the government has agreed to withdraw green leaf thrashing (GLT) tax on tobacco because it was a burden on the grower. However, he stated that this would not have any impact on the price of cigarettes. “We are ready to review all those things in the budget that could hurt the growers,” he added. The minister said that withdrawal of this tax does not mean there would be any reduction in duty or revenue loss to the government.

The government, he said, is following the latest studies with regard to tobacco sector and “those days have gone when mutilators’ and powerful lobbies’ interest was considered important in policy making.” He said this on some members’ complaint with regard to influence of powerful lobbies on the Federal Board of Revenue (FBR) and wanted the minister to stop their influence.

Azhar said that the government has estimated between Rs 114 and Rs 115 billion tax collection from tobacco sector in the next fiscal year and Rs 135 to Rs 140 billion for the subsequent fiscal year. The minister said that cigarette manufactures are not in favour of removal of GLT tax for farmers.

The meeting also decided to adopt a holistic policy with regard to revival of agriculture sector and especially arresting the declining trend witnessed during the last few years in cotton areas where sugar production is replacing cotton. The speakers assured the representatives of farmers that all their legitimate issues would be addressed and their meeting with the Prime Minister would be arranged as well. The farmers stated that it is extremely difficult for them to afford even existing rate after the inclusion of FPA and other taxes.

The committee also proposed for increased allocation for agriculture research, particularly seeds certification and developing verities of new seeds.