PPP puts IMF-backed tax regime on back burner due to “opposition by main parties”

ISLAMABAD - The Pakistan People’s Party (PPP) government has decided to put aside the controversial tax law for the time being, owing to the stiff opposition by almost all the political parties, including its allies.

“The discussion on the proposed reformed general sales tax bill at the level of standing committee on finance has been put off because of opposition by main parties and as a result its implementation will get delayed,” the Dawn quoted Fauzia Wahab, chairperson of the National Assembly’s Standing Committee on Finance, as saying.

The government had assured international donors that it would approve the bill as early as possible, and that the Reformed General Sales Tax (RGST) would be implemented in January.

But almost all political parties, including the PML-N, PML-Q, MQM and JUI-F, said they would oppose the bill in the National Assembly. The Awami National Party (ANP) is the only coalition partner that is supporting the PPP government on the bill.

Although the Standing Committee will meet in a couple of days, Wahab said it would focus on removing differences that emerged at the last session.

“I will first hold an internal meeting of the committee shortly to sort out our differences. No other officials or media personnel will be allowed to attend this meeting,” she said.

Wahab, however, did not say when the standing committee meeting would be convened to discuss the bill.

As a result of the government’s failure to muster support for the bill, the 11-billion-dollar International Monetary Fund (IMF) bailout package has been in doldrums. Under the agreement, the IMF programme for Pakistan was scheduled to end this year, but the release of its last two tranches has been delayed because of the government’s failure to implement the IMF-dictated economic reforms.

“I think the (RGST) bill may even be delayed till the next budget in order to take all parties on board,” said Riaz Fatyana, a PML-Q member of the committee.

The RGST bill would be deemed to have been killed if any province voted against it, said Fatyana, adding, “The PPP will have to take all parties on board on the issue.” (ANI)