Earnings of NEPRA officials soar by up to 551%

Chairman paid Rs9.97m compensation in FY20 compared to Rs1.53m in FY19

The salaries and allowances paid by the National Electric Power Regulatory Authority (Nepra) to its chairman and four provincial members has soared by up to 551% in the fiscal year ended June 30, 2020 compared to what they received in the preceding year.

The chairman received a sum of Rs9.97 million on account of managerial remuneration and other allowances in fiscal year (July-June) 2020 that was 551% higher than Rs1.53 million received in fiscal year 2019, according to Nepra’s Annual Report 2020, published this week.

Accordingly, the chairman received remuneration at Rs0.83 million per month during FY20 compared to Rs0.13 per month in the previous year. The chairman received substantial increase on account of other allowances to Rs4.18 million during the year compared to a mere Rs26,717 in the preceding year.

Besides, members of the authority representing four provinces; Balochistan, Khyber-Pakhtunkhwa, Punjab and Sindh, received a sum of Rs39.52 million during the year that was 176%higher compared to Rs14.30 million received in the previous year.

This suggests that each member received a sum of Rs9.88 million during FY20 that translates into Rs0.82 million per month.

Nepra’s tax exemption ends

The Federal Board of Revenue (FBR) has withdrawn the income tax exemption from Nepra and asked the power regulatory authority to pay a sum of Rs290 million for the tax years 2003-07, the annual report added.

Nerpa has, however, filed a case in the high court against FBR’s end of the exemption for the tax years 2003-07.

It elaborated that the tax authority issued notice to Nepra for filing of return of total income for the tax years 2003 to 2007. The Nepra management communicated its legal stance through correspondence with the tax authorities. However, “to comply with the requirements of statutory notices, returns for the tax years were filed claiming the net income of the Authority (Nepra) being exempt from tax.”

However, the tax authorities amended the assessments for the tax years in question by rejecting the stance taken by Nepra and raised a net tax demand of Rs290 million.

The Commission Inland Revenue (Appeals) also upheld these amendments. The appeals filed with Appellate Tribunal Inland Revenue against the order of the commissioner Inland Revenue (Appeals) were also rejected by the Appellate Tribunal Inland Revenue by placing reliance on the judgment of the High Court in the matter of Pakistan Telecommunication Authority (PTA).

Whereas, amendment for the tax year 2003 was annulled by the Appellate Tribunal Inland Revenue on legal grounds. “The Authority (Nepra) has filed reference before the High Court which is pending adjudication,” Nepra said.

Due to the pendency of these cases, the authority has accounted for the amount of Rs290 million paid as tax as advance. However, no provision for the same has been made in these financial statements (for fiscal year 2020), it said.

Nepra received gross fee income (for award and change in licenses) of Rs1.44 billion during the year compared to Rs1.30 billion in the previous year. It paid Rs43.45 million to the Competition Commission of Pakistan (CCP) during the year.

“This represents an amount payable to CCP under the CCP Act whereby five (regulatory) authorities are required to pay an amount equal to 3% of its revenue to CCP every year,” it said.

Published in The Express Tribune, October 25^th, 2020.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.