PC agrees to give Thar coal project tax-free status

KARACHI: The recommendation to declare the Thar coal project a special tax free zone for a period of thirty years has been accepted by the Privatisation Commission (PC).

Official sources have informed The Express Tribune that the commission has accepted suggestions put forward by the Thar Coal Development Board (TCDB) and Board of Investment (BOI) to give the Thar coal project tax free status in order to attract investment.

The PC has sent a summary to the finance ministry for approval and the matter will be discussed by the Economic Coordination Committee before any final decision is made.

The issue has also been added to the agenda of the Pak-US Strategic dialogue and the US has been approached for financial assistance to help fund the project.

It was learnt that the PC has agreed to the proposal forwarded by the TCDB and BOI to help control the looming power crisis and ensure quick completion of the project.

Sources revealed that in order to encourage investment by large groups and consortiums, a list of recommendations had been prepared and were presented to the commission on July 15 in a special briefing session. All these recommendations have been approved.

These suggestions include the exemption of tax on the sale of coal, the import of plant and machinery at zero rate, an internal rate of return of 25 per cent on projects completed by 2014 and 20 per cent on projects completed by 2015 and granting the authority to set coal prices to the Coal Energy Board.

Published in The Express Tribune, July 22^nd, 2010.