Utility Stores Corporation awaits tax break, subsidy

Senate body had approved the relief over 1 month ago

ISLAMABAD: The proposal for granting tax exemption to the Utility Stores Corporation (USC) along with restoration of government’s subsidy and exemption from Public Procurement Regulatory Authority (PPRA) rules has not been given the go-ahead even though one and a half month has passed.

Earlier, the Senate Standing Committee on Industries and Production had approved the proposal in a bid to provide relief to the common man but still there had been little progress on the matter.

USC officials said the issue also came up for discussion in a meeting chaired by Prime Minister Imran Khan, following the approval of the proposal by the standing committee, aimed at providing relief to the general public seeking to buy essential commodities.

On the other hand, FBR officials argued that they had not received any official letter from the Ministry of Industries and Production in this regard. Instead, they pointed out, they had only received a copy of the minutes of the meeting of the Senate Standing Committee on Industries and Production.

Despite repeated attempts, FBR spokesperson Hamid Ateeq Sarwar could not be contacted. According to the copy of documents available with The Express Tribune, the committee proposed exemption from interest payment and taxes for the USC and demanded that it be considered a welfare organisation.

In addition to that, it also directed FBR officials to prepare a briefing on the issue in next meeting of the standing committee.

Keeping in view the recommendation of restoring the government’s subsidy, the committee sought details of the reasons behind suspension of the subsidy. Besides that, it also proposed to include USC in the Benazir Income Support Programme so that deserving people could make necessary purchases from the utility stores.

Officials of the Benazir Income Support Programme have been asked to attend the next meeting and give a briefing on the issue. USC Managing Director Umer Lodhi informed the meeting that if the taxes imposed on USC were reversed, then the enterprise would become profitable. He pointed out that even CSD was not paying any taxes.

According to the documents, the participants of the meeting were told that USC was paying taxes duly despite operating in a loss.

Published in The Express Tribune, November 17^th, 2019.

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