ISLAMABAD, April 7: Finance Minister Shaukat Aziz told the National Assembly here on Wednesday that the government was not considering any proposal to withdraw sales tax on agriculture inputs.
Replying to a number of supplementary questions during the question hour in the lower house, the finance minister said the government had provided a subsidy of Rs9 billion on gas to the fertilizer industry.
Besides, the prime minister had also formed a committee to review the price of fertilizer, taxes and duties on agricultural inputs, the recommendation of which would also be considered by the government.
However, the back-benchers both from the treasury as well as the opposition especially belonging to the agriculture community confronted the minister and demanded removal of taxes on the agricultural inputs.
The members agitated that due to price increase especially in fertilizers and other agricultural inputs, the land productivity had reduced by 33 per cent, which was adversely affecting the GDP growth of the country.
The best way to fight poverty, which is also the main focus of the government, is to facilitate the growers by reducing the prices of the agricultural inputs, the members said.
National Assembly Speaker Chaudhry Amir Hussain, however, asked the members to move a motion under Rule 69, under the house procedures, for a full debate on the subject.
Commerce Minister Humayun Akhtar also told the house that the international prices of the fertilizers were rising but the ratio of increase in Pakistan was far less, than the price hikes in the international market.
He explained that three million metric tons of Di-Ammonium Phosphate (DAP) was imported between 2000 and 2003 from different countries at unit value varying from $167 per metric ton to $213 per metric ton.
Finance Minister Shaukat Aziz also claimed during the question hour that indications suggested that the level of poverty has reduced further, the exact proportion of which however has yet to be ascertained as complete data has not yet been compiled.
The minister said the initial document of the interim Poverty Reduction Strategy Paper (IPRSP) was released in November 2001 and the summarized version of the draft poverty reduction strategy paper prepared in May 2003 was tabled on the floor of the house in June 2003 along with the budget.
Similarly, the government would place the full PRSP along with budget the documents 2004-05 before parliament. He also explained that PRSP was based on four core pillars, namely accelerating economic growth while maintaining macroeconomic stability, improving governance, investing in human capital and targeting the poor and the vulnerable.
To another question, he said investment in different sectors of the economy has increased by 16.5 percent during the current financial year and was increasing at an average rate of over 15.7 per cent since the year 1999, due to home-grown macro-economic policies and structural reforms introduced by the government.
Similarly, the GDP growth rate due to the economic policies has increased to 6 per cent in the current financial year. About the euro-bonds, he said it was floated to raise funds to improve the country's economy as well as to ensure re-entry into the international capital market to induce foreign direct investment.
To a question, he said the foreign loans and liabilities have come down from $38 billion to $34 billion and due to the economic growth Pakistan was now in a position where it could pre-pay Asian Development Bank's loan worth $1.17 billion this year.
