ISLAMABAD: The Senate Standing Committee on Finance and Revenue on Friday finalised recommendations for amendments in the federal budget 2015-16 and expressed concern over renewed petrol shortage in the country.

Presided over by Senator Salim H. Mandviwala, the committee demanded further increase in salaries and pensions, reduction in tax rate on oil products and sought increase in electricity slab for lifeline consumers.

The committee concluded its weeklong deliberations on the budget for approval.

Mr Mandviwala raised the issue of petrol shortage in some central and northern parts of the country, including Islamabad and Rawalpindi.

The committee recommended that salaries and pensions of government employees should be increased by at least 25 per cent. It also recommended a maximum general sales tax rate of 15pc on all petroleum products by reducing the existing rates.

The committee also recommended increasing the consumption level for domestic lifeline consumers from current 50 units to 150 units per month in view of vast change in consumption patterns over the decades, making 50 units insufficient.

Secretary of Planning Hasan Nawaz Tarar told the committee that the federal government would release Rs5 billion for Karachi Green Line Project till June 30. Salim Mandviwala said the government had kept only Rs100 million in budget for the project which was a joke.

During the meeting, exchange of hot words took place between Senator Taj Haider of PPP and secretary of finance Dr Waqar Masood Khan when the senator accused the centre of violating the promises made to Sindh and snatching its surplus budget in violation of the Constitution.

Dr Khan said that the federal government transferred revenue collected by the Federal Board of Revenue (FBR) every month on the basis of provincial share, but provincial shares could fluctuate due to actual revenue collection.

He said the FBR’s collection is now expected to be around Rs2.605 trillion against the budgetary target of Rs2.810tr and as such shares of all provinces and the centre would get affected proportionately.

Senator Hassani said India was conspiring against Pakistan’s development and blocking its trade and it was now responsibility of the government to link Gawadar with Central Asian States for which Gwadar to Taftan Motorway was of critical importance that should be expedited.

Secretary of finance told the committee that commercial banks could invest a maximum of 18pc in government securities and treasury bills.

He said the share of government guarantees in commercial banks had increased to 60-70pc and if banks continue lending to the government, they would not have enough liquidity to meet the needs of the private sector. Therefore, the government will have to concentrate on reducing loans.

FBR chairman Tariq Bajwa said about Rs60bn worth of mobile phones had been imported in the first 10 months of the current year.

He said a two per cent tax had been imposed on land developers in the new budget.

Published in Dawn, June 13th, 2015

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