PSO receives Rs11b in debt repayment

FBR will recover Rs5b in taxes from this amount.

ISLAMABAD:

In a bid to tackle inter-corporate debt and reduce the shortage of petrol, the federal government has released Rs11 billion which will be paid to Pakistan State Oil (PSO) for making oil supplies, says an official of the finance ministry.

The release of funds would ease some pressure off PSO, the largest oil marketing company of the country, and it would be able to open more letters of credit for oil import to cope with its shortage in the country, he said.

However, of the Rs11 billion released by the government, the Federal Board of Revenue (FBR) would recover Rs5 billion in taxes – Rs3 billion on Friday and Rs2 billion on Monday.

A senior FBR official attributed the recovery of taxes to an earlier agreement reached between FBR and PSO which said that tax would be deducted from the outstanding dues released by the government. In addition to Rs5 billion, the FBR official said PSO had to pay Rs2.7 billion.

He said FBR had also to recover billions of rupees from the Trading Corporation of Pakistan (TCP), adding demand for payment of Rs3 billion had already been made and the amount was expected to be recovered in coming days. Besides, he said, FBR would also recover Rs2 to Rs2.5 billion from TCP.

The official said oil marketing companies had also to pay necessary tax, for which an agreement had been reached with them.

Published in The Express Tribune, June 24^th, 2011.