Senate panel raises concern over tax exemptions, border security

ISLAMABAD: A subcommittee of the Senate Standing Committee on Interior and Narcotics Control on Monday examined border security arrangements at key import entry points, reviewed alleged tax evasion linked to imported raw material meant for tax-exempt areas, and discussed the affairs of the Senate Employees Housing Cooperative Society.

The meeting was held at Parliament House under the convenership of Senator Saifullah Abro. Senators Muhammad Talha Mehmood and Umer Farooq attended the session, while Senator Dilawar Khan joined as a special invitee.

Tax exemption review

Officials from the Federal Board of Revenue told the panel that a detailed report on the tobacco taxation matter had already been submitted. They also said provisional information on tax-exempt imports in different sectors had been compiled from manual records and would be finalised within a week.

The committee voiced serious concern over what it described as a wide gap between the value of tax-exempt imported raw materials and the consumption certificates issued against them. Members asked the FBR to fully investigate the issue, especially in high-value sectors such as ghee, in order to trace tax leakages, expand the tax net and recover revenue that may have been evaded.

The panel was informed that about 50 cases involving rejected consumption certificates were pending in courts after the affected parties secured stay orders from the Peshawar High Court. FBR officials told the committee that the high court had ruled the tax authority could not reject consumption certificates and should instead carry out audits. According to the officials, the FBR has challenged that ruling before the Federal Constitutional Court.

Senator Abro directed the FBR to actively pursue the case before the Federal Constitutional Court and said proper scrutiny of tax-exempt raw material imports could bring significant revenue to the national exchequer. He also asked the tax authority to submit a comprehensive report to the committee within 10 days. The committee said it remained committed to strengthening the tax system by identifying loopholes and suggesting steps to stop misuse of exemptions.

Senate housing society complaints

The panel also took up complaints related to the Senate Employees Housing Cooperative Society, including reports that Senate employees had still not been given possession of their plots and allegations that the society was being run by private individuals rather than its members.

Officials of the Federal Investigation Agency informed the committee that a first information report against the management of the Senate Housing Society had earlier been registered on the orders of the Supreme Court. The committee directed the FIA to provide an updated report within one week on the society’s current management structure.

Senator Abro instructed the FIA to proceed with strict legal action against those allegedly managing the society unlawfully and stressed that control of the body should remain with its legitimate members. He also reiterated the committee’s commitment to protecting the rights and interests of Senate employees and ensuring transparency and accountability in the society’s affairs.