Provinces yet to receive share

The distribution of funds owed to provinces according to the National Finance Commission Award has been halted.

ISLAMABAD: The distribution of funds owed to provinces according to the National Finance Commission (NFC) Award has been halted by the federal government.

The ministry of finance has indicated a shortage of funds and said that provinces will receive their due share when revenue is received from the Federal Board of Revenue (FBR).

According to Dr Qaiser Bengali, Finance Adviser to the Chief Minister of Sindh, provinces have not received the funds promised to them under the NFC Award.

He conceded that the issue of reformed General Sales Tax (GST) on services has remained contentious and hoped that revenues from this would be directed to the provinces once the matter is resolved.

He complained that since there remained no disagreement on the division of GST on goods, Islamabad should immediately dispatch each province’s share.

Meanwhile, a senior official of the finance ministry has contended that provinces will get their share once revenues are received from the FBR. He also explained that since tax collection has been sluggish during the first one and a half months of the current fiscal year, provinces have not been able to receive funds due under the NFC Award.

It is expected that the provinces will receive their share by the end of the first quarter of this fiscal year, he claimed. He added compilation of statistics on revenue collection took time. Funds to provinces are released on the basis of these figures.

However, FBR officials have claimed that the Board is only a tax collecting body and all revenue is deposited into the treasury. Furthermore, details of the taxes collected are provided to the government and distribution is undertaken by the ministry of finance.

On the other hand, Haji Adil, a member of the National Finance Commission, claimed that nothing can be alleged against the functioning of the NFC Award prematurely since a review of the implementation of the Award is held every three months. The next such review is due to be held during the first week of October.

According to the constitution, a report prepared on the execution of the NFC Award is to be presented in the national and provincial assemblies every four months.

Published in The Express Tribune, August 26^th, 2010.