Islamabad: Senate Standing Committee on Finance Revenue and Economic Affairs met the second consecutive day with Senator Talha Mahmood in the chair to finalize and make recommendations in the Finance (Supplementary) Bill, 2021.

The proposed amendment from 1.5pc value of Gold and 2pc value of Diamond plus 3pc of making charges, to 17 % sale tax on articles of jewellery or parts of precious metal has been rejected by the committee unanimously as a consequence of crippling of the documented segment of the Jewellary business and a drastic fall in the tax revenue of the state.

Similarly, the committee disposed of the petition by the match box industry on the proposed amendment of exemption of tax on matchboxes with the directive to retain the previous regime of sales tax on the matchbox industry on the same analogy of securing the documented industry and increased revenue in the interest of the state.

The committee failed to comprehend the analogy behind the proposed amendment which outcome will result in encouraging the undocumented business industry.

The committee noted that the proposed amendment is highly discriminatory as it will only affect the sales tax registered companies. It was transpired in the committee that 80 tons of gold are smuggled into the country annually.

The Gold Association lamented that Pakistan has no gold import policy and tax system, “Not only gold but also diamonds are being smuggled in”, according to the Progressive Jewellary Groups.

The FBR officials informed the committee that 160 tons of gold are used annually in Pakistan, and the Gold market in Pakistan is around Rs 2.2 trillion. Only Rs. 29 billion gold markets is declared in the Federal Board of Revenue. “Out Of the 36,000 goldsmiths, only 54 pay the Goldsmith tax” the FBR informed..