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Wednesday, April 17, 2024

Foreign currency smuggling needs to be stopped: CJP

CJP Bandial encouraged the government to act to curb the smuggling of foreign currency and refuted the notion that the nation was close to bankruptcy.

On Friday, Chief Justice of Pakistan (CJP) Umar Ata Bandial dismissed the idea that the country was on the verge of bankruptcy and urged the government to take action to stop foreign currency smuggling.

A hearing into the Federal Board of Revenue’s (FBR) petition to the Lahore High Court’s ban on the taxman attempting to collect a “super tax” from industries was resumed by a three-member panel led by Justice Bandial.

To lessen the impact of growing inflation on the underprivileged, the government announced intentions to impose a one-time 10% tax on the profits of large enterprises in June of last year. The FBR estimated that the super tax will generate Rs250 billion in revenue in FY23.

The government implemented a super tax on those with high incomes through the Finance Act 2022 by adding a new section, 4C, to the income tax ordinance. Thirteen industries earning more than Rs150 million would be subject to a 10 percent super tax through this section beginning in the tax year 2022.

After several businesses filed lawsuits against the super tax with the Lahore High Court (LHC), the LHC put a stop to the FBR’s ability to collect it. In response, the FBR filed a SC appeal against the LHC’s decision.

The LHC’s interim ruling was changed by the Supreme court during the most recent hearing on February 6 and affluent individuals were instructed to pay half of their super tax obligations directly to the FBR within a week.

The Supreme Court wanted to group all super tax-related pleas today so they could be considered concurrently.

Read More: Why Pakistan needs to think twice before accepting IMF conditions

FBR attorney Faisal Siddiqui informed the court at the beginning of the hearing that the LHC had deferred the application of its final judgement to the matter for a period of 60 days.

The firms’ attorney, Farogh Naseem, stated that with the announcement of the provincial court’s final ruling, all applications filed by the FBR against the LHC’s interim order had lost their validity.

The case may be scheduled for a hearing the following week, the chief justice suggested. He said that the extra tax was applied by the FBR “in good faith.”

According to CJP Bandial, it was also well known that Shell Pakistan, one of the petitioners, paid millions of rupees’ worth of taxes.

Siddiqui replied, “Right now I am representing the FBR.”  If the country went into default, he declared he would also pitch in for the federal government.

He was cut off by the chief justice, who assured him that the country was “not going bankrupt.” He continued, “Everyone needs to better themselves for the good of the country.

The judge adjourned the hearing until February 16.