Press Conference by Finance Minister on economic matters

Islamabad, October 31, 2016 (PPI-OT): The Finance Minister, Senator Mohammad Ishaq Dar, held a press conference here on Monday to announce a host of important economic initiatives. Announcing the petroleum process effective 1stNovember 2016, the Finance Minister said that in keeping with the Prime Ministers instructions to provide maximum relief to the consumers, it has been decided that the prices of all products will be maintained at the current level of MS Petrol Rs 64.27, HSD Rs 72.52, Kerosene Rs 43.25, LDO Rs 43.34for the month of November 2016. OGRA had recommended per litre increase in all products, i.e., MS Petrol Rs 2.29, HSD Rs 2.00, Kerosene 6.75, LDO Rs. 6.40.

According to calculations of Ministry of Petroleum the current price of HOBC is Rs. 72.68 per litre is likely to increase by Rs. 9.82 to Rs. 82.50 per litre. However the Prime Minister has also approved that the price of HOBC may also be maintained at the current level for the month of November 2016.

The Finance Minister also gave the following comparison of the General Sales Tax collected by the previous democratic government in March 2013 (Rs per Litre) and the GST approved for these products for November 2016:

Product             01-03-2013       01-11-2016 (Proposed)

MS (PETROL)           14.70                  9.10

HSD                   15.66                 17.99

KEROSENE              14.30                  0.85

LDO                   13.55                  0.85

HOBC                  19.32                 10.56

He said that the government has not increased the prices since April 2016 and will continue to maintain the prices for November 2016 as well. Finance Minister said that maintaining prices of petroleum products at the current level is having a negative financial impact on revenue collection. But this impact will be borne by the government to provide petroleum products to the end consumer at stable price.

The Finance Minister announced that, pursuant to the promise made by Prime Minister Muhammad Nawaz Sharif due process has been completed for issuance of sales tax refunds, amounting to Rs. 25 billion, for Refund Payment Orders (RPOs) issued up to June 30, 2016. He said that payments of these refunds shall be made to the recipients within the next seven days.

He said that, for the first time ever, these refunds shall be paid directly into the accounts of the refund recipients, in order to save them from the inconvenience of depositing and clearing cheques. He said that the State Bank of Pakistan is making the necessary arrangements in this regard. He also stated that a focal person has been nominated at FBR for the refunds. Finance Minister said that all complaints in delays or difficulty in obtaining these sales tax refunds can be addressed to FBR focal person at strefund@fbr.gov.pk

The Finance Minister also provided an update regarding the OECD Multilateral Convention on Mutual Administrative Assistance in Tax Matters, which Pakistan signed in July 2016. He said that Pakistan’s signing of the Convention reaffirms the government’s commitment to fight tax fraud and evasion at the international level, and under lines Pakistan’s pledge to exchange information under the automatic exchange provisions of the Convention.

He said that Pakistan’s integration with the rest of the world though the Convention will enable availability, on a reciprocal basis, of banking and other information about its residents and nationals from other Parties to the Convention. He said that for the Convention to come into force, it has to be ratified by the President of Pakistan and the Instrument of Ratification has to be deposited with the OECD along with required annexures. He said that the Federal Cabinet is expected to grant approval for ratification of the Convention on November 02, 2016, after which the instrument of ratification will be issued with approval of the President of Pakistan and will subsequently be deposited with the OECD.

The Finance Minister also informed that the Draft Companies Bill, 2016 has been finalized after extensive consultations with all stakeholders, and is ready for presentation to the Cabinet for further legislative processing. He said that the Draft Bill emphasizes use of technology at all levels including filing of documents to SECP electronically, supply of documents to members electronically, voting through e-ballot, participation in meetings through video link, and conversion of physical shares into book-entry form.

He stated that in order to address challenges posed by off-shore companies, an enhanced disclosure regime for officers and members of those companies has been provided under the Draft Bill, while stringent penalties have been introduced in cases of false or non-disclosure. He said that the Draft Bill also introduces other reforms such as simplification of the Memorandum, passing of members’ resolution through circulation, and the amalgamation of wholly owned subsidiaries in the holding company without any approval. He further informed that the Draft Bill also introduces Agriculture Promotion Company as a new type of a company, in order to promote the agriculture sector.

For more information, contact:
Director General (Media)
Nadeem Haider Kiani
Ministry of Finance
Government of Pakistan
Room # 514, Block-‘Q’, Finance Division,
Pak. Sectt. Islamabad
Tel: +92-51-9211707, +92-51-9208281, +92-51-9206382
Fax: +92-51-9210877
Email: so_coord1@finance.gov.pk