The Senate Standing Committee on Finance recently discussed the tax measures announced in the 2024-25 budget, expressing dissatisfaction with how they seemed to prioritize IMF interests over national interests. Led by Chairman Senator Saleem Mandiwalla, the committee raised concerns about the unequal distribution of the tax burden, especially the controversial tax on infant milk.
Officials disclosed that while some tax exemptions were removed, they fell short of the IMF’s demands. The committee rejected some proposed taxes, such as an 18% sales tax on mobile phone sets below $200, citing potential negative impacts on low-income individuals.
Tax on graves?
Senator Farooq H. Naik criticized the IMF-influenced budget decisions, including proposed tax measures on various items, such as telecommunications. The committee proposed recommendations to benefit the general public, such as mandating credit card transactions for purchases exceeding Rs35,000 and reducing taxes on specified stationery items.
Costly healthcare
Additionally, concerns were raised regarding the taxation of medical equipment and the impact on healthcare costs. The committee recommended differentiated tax rates for the telecom sector and exempting corporate debit card transactions from an additional tax.
Recommendations
The committee’s recommendations included promoting economic documentation through card transactions, uniform sales tax rates for solar industry components, and exempting certain stationery items from taxes. They also proposed measures to address tax exploitation by organizations and provide allowances for disabled individuals.
Published in Dawn, June 23rd, 2024