KARACHI: Sindh Chief Minister Syed Murad Ali Shah has said that the federal government is planning to take away the power of the provincial government to collect taxes.

He also disclosed that this year the province witnessed a shortfall of Rs104 billion from federal funds’ transfers and this would affect development projects.

The chief minister said this while talking to the media after attending the National Community Convention organised by non-governmental organisation HANDS in Gadap on Monday.

The chief minister said after failing to achieve its revenue collection targets, the federal government was now planning to take away the provincial government’s authority of collecting taxes on agriculture, sales tax on goods, services and determination of property valuation.

The CM says the federal govt failed to achieve its revenue targets

Comparing the tax collection capacity of the province with the federal government, Mr Shah said that the Sindh government during the last five years had shown an annual increase of 22 per cent in its revenue collections while the federal government could only show 8pc growth.

“Instead of appreciating and giving rewards to the provincial government, the federal government was planning to take away the power of the provincial government of collecting taxes falling under its domain,” he said, adding that if the powers of collection of all the taxes went with the federal government one could only imagine the fate of the national and provincial exchequers.

Mr Shah said that the provincial government could collect taxes in a better way than the federal government because the former was very close to the consumers. “I am of the opinion that the power of collection of sales tax should be completely given to provinces,” he said.

To another question, Mr Shah said: “This year the federal government has transferred Rs104bn less than the share of the provincial government.”

He said it was for the first time in the history of Pakistan that the federal funds’ transfers had come down compared to the previous year.

The chief minister explained that in January 2018 the federal government had transferred Rs56bn while this January they had transferred only Rs38bn.

Terming this declining trend dangerous, he said it was bound to badly affect the cash flow and development portfolio. “I was moving fast on the development of the province but looking at the federal transfers I have stopped development endeavour,” he added.

Media dues linked to employees’ salaries

Replying to another question, the chief minister said that his government would release arrears of all media houses provided they give outstanding salaries to their employees.

He added that Pakistan Peoples Party chairman Bilawal Bhutto-Zardari during his visit to the Karachi Press Club had assured journalist fraternity that he would work hard to resolve their issues of unemployment, retrenchment and ensure the freedom of expression and speech.

Earlier speaking at the convention, the chief minister said that his government would support HANDS chief Dr Ghaffar Billoo to establish a nursing institute.

“We will support you in giving you the charter for establishing the institute and strengthen you financially,” he said.

Mr Shah appreciated HANDS for its health services.

He said that the Sindh government was the pioneer of the public-private partnership (PPP) mode and his government had started it in road infrastructure sector and then expanded it to education, health and now to energy sector.

Meanwhile, the CM chaired a meeting to firm up the provincial government’s recommendations for the 8th National Finance Commission award.

He reiterated his stance that the federal government should hand over the powers of GST collection to the provinces.

Published in Dawn, February 5th, 2019