IMF seeks explanation from Pakistan for not imposing tax on big shops

ISLAMABAD: The International Monetary Fund (IMF) has sought an explanation from Pakistani government for not imposing tax on big shops measuring 1,000 square feet, ARY News reported on Wednesday.

The Federal Board of Revenue (FBR) chairman confirmed that the IMF sought an explanation for not imposing tax on big shops.

A session of the Senate’s Standing Committee on Finance was held under the chair of Senator Salim Mandviwalla today. It was learnt that the national exchequer suffered $847 million loss due to imports of 31,542 banned items.

The Senate body sought a report from the FBR in a month. However, the FBR officials rejected the imports of banned items which caused a massive financial loss to the exchequer.

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In a briefing, the FBR officials said that 28,321 items were not banned and their imports were carried out through open accounts. They added that an investigation is underway into the imports of 3,351 banned items which caused $6 million loss.

They detailed that the banned items included auto spare parts, imported shoes and other commodities.

The State Bank of Pakistan (SBP) told the Senate’s standing committee that LCs are not being stopped as per the commitment with the IMF. The central bank’s officials said that all kinds of LCs are being opened after June 2023.

The Senate body sought a report after clearing the complaints regarding the restrictions on LCs for imported vehicles.

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Earlier in the month, the government of Pakistan fulfilled an important condition of International Monetary Fund (IMF) and Financial Action Task Force (FATF).

The National Assembly passed the National Anti-Money Laundering and Counter Financing of Terrorism Authority Bill 2023. It was moved by Minister of State for Foreign Affairs Hina Rabbani Khar.

The Minister of State for Foreign Affairs said this legislation is of immense importance and if enforced and properly implemented, it will make sure that Pakistan does not see the FATF’s grey list again.

Hina Rabbani Khar said the bill envisages the establishment of a National Anti-Money Laundering and Counter Financing of Terrorism Authority. She said the Chairman of the authority will be appointed by the Prime Minister.

She informed that the authority will comprise of the Secretary Finance, the Secretary Foreign Affairs, the Secretary Interior, the Governor State Bank of Pakistan, the Chairman Securities and Exchange Commission of Pakistan, the Chairman NAB, the DG FIA, the DG Anti-Narcotics Force, the Chairman FBR, the DG Financial Monitoring Unit, the National Coordinator of NACTA and the chief secretaries of the provinces.