Revenue generation: Govt formally decides to tax Gilgit-Baltistan

G-B finance minister opposes the move, terms it a conspiracy against the region.

GILGIT:

Gilgit-Baltistan (G-B) government will generate nearly Rs10 billion from taxes on the corporate sector, registered firms, corporations and salaried class. This was stated by G-B Public Accounts Committee Chairman Muhammad Ibrahim on Saturday, as the government formally decided to bring the region under the tax net on Friday.

He said that the tax will be imposed on all people who earn over Rs50,000 per month, adding that the poor segment of society will not be affected by the decision.

Criticising PML-N chief Hafizur Rehman and PML-Q leader Mirza Hussain’s statements, Ibrahim said that the tax will assist the government to deal with the problems which have surfaced in the region due to lack of funds.

He said that the organisations working on huge projects, including the one that worked on the Sadpara Dam did not pay any taxes in the past. However, after the imposition of taxes, the companies working on Bunji Dam and Diamer-Bhasha Dam will have to pay the tax to the government.

He explained that they were in contact with the Federal Board of Revenue to recover Rs8billion to Rs10 billion which were paid earlier under General Sales Tax.

Dispelling the impression that the federal government was behind the imposition of the tax, Ibrahim said that the decision was taken by the G-B government with the aim to bring prosperity and welfare in the region.

“The federal government has nothing to with the tax. All the revenue generated will go to the G-B exchequer,” he claimed.

“If the federal government wanted to tax the region, it would have done 64 years ago,” he remarked.

Responding to a question, Ibrahim said that the tax would not increase the price of commodities as they were not produced in G-B.

Meanwhile, sources in the G-B Council said that the legislation on the tax would be tabled during the G-B Council Session, which would commence on October 3 and would be presided by Prime Minister Yousaf Raza Gilani.

They said that a high level meeting held in Islamabad on Friday formally decided to impose taxes in G-B, adding that the G-B Finance Minister Muhammad Ali Akhter was not present in the meeting.

Akhter had earlier declared the imposition of tax in G-B as ‘illegal’ due to non-representation of G-B in the parliament. His claim has largely been supported by national parties in the region. Sources also said that his absence in the meeting exposed differences in the PPP ranks at G-B level.

“It is a conspiracy against the government. I am the finance minister but I don’t know where the money comes from and where it goes,” Akhter told The Express Tribune last week.

He accused the bureaucracy of being the beneficiary of the move [tax imposition] and said that the finance ministry didn’t know about the revenue being collected in the region.

Published in The Express Tribune, October 2^nd, 2011.