02 July,2022 , 03:11 amAdmin

Inflation Increased Due to a Rise in POL Prices: Miftah

The Minister of Finance Miftah Ismail on Friday conceded that the increase in POL prices was pushing upwards the pressures of inflation in the country. But, he said there was no choice but to make tough choices to increase the POL prices to avoid bankruptcy.

There were two options before us:

"Either confront the same situation as Sri Lanka and let the rupee fall to as low as 400 against the US dollar following the threat of default. To take a tough decision with regard to the withdrawal of massive subsidies. And transfer the international price to consumers in India. We chose the hard option and increased POL costs," Federal Minister for Finance Miftah Ismail said while hosting a news conference. At the headquarters of the state-run television alongside FBR Chairperson Asim Ahmad on Friday.

Miftah Ismail - POL Prices

Minister said that the IMF has presented the government Memorandum of Economic and Financial Policies (MEFP). And that the government was examining it with care and was not looking to make decisions in a hurry. "It is expected that the parleys on MEFP will be finalized in a few days and then the staff-level agreement will be struck," the minister said.

IMF to increase the Petroleum Levy

The minister stated it was the PTI who had agreed with the IMF to increase the petroleum levy. By Rs4 per liter and increase it to 30 cents per liter in a gradual manner before applying 17 percent GST to POL products. If the current regime had followed through with the agreement reached by the PTI-led administration that the price of petrol. Should have increased by about 75 cents per liter and diesel by an amount of Rs81 per liter. But the current regime increased the price of petrol to the amount of Rs14.85 per liter and introduced an oil levy of Rs10 per liter. On diesel, a rate was Rs5 per liter. in place.

He claimed that the incumbent government could not pay for a subvention of Rs120 billion for POL products on a monthly basis. They would rather charge international prices to customers.

Performance of the FBR

The minister was extremely pleased with the performance of the FBR. And stated they had exceeded the planned goal and raked in an amount of Rs6,125 billion for the fiscal year that ended June 30th, 2022. He also said that the FBR had a target of Rs6,050 billion. But the FBR beat its upward goal of the figure of Rs6,100 billion.

FBR Chairperson Asim Ahmad announced, at the occasion that the tax machinery would make use of technology to broaden the tax base. Currently, 0.7 million retailers will be incorporated into the fixed tax system. That was announced by the government in the budget 2022-23 in order to collect fixed taxes through electricity bills. He also said there was a possibility that Track and Trace System would be implemented for tobacco following lifting the stay order from the High Court.

The FBR began to collect information from Nadra in order to reach the goal of expanding the tax base. The initial set of data was released by Nadra to discover how the base could be expanded.

Tobacco Manufacturers - POL Prices

He also said that two additional industries would be included in the Track and Trace System, including the cement and fertilizer sector, during the current budget year of 2022-23. The government has implemented the Track and Trace System for tobacco producers and the Sugar industry. However, some tobacco industry players have been in contact with Peshawar High Court and obtained stay orders. However, the official tobacco industry like the Pakistan Tobacco Company had installed. Track and Trace System in its Jhelum factory in the past fiscal year. "Now the stay order has been vacated and implemented. On Track and Trace System will be implemented from July 1, 2022," the Chairman of the FBR stated.

This Track and Trace system will put marks on products produced by certain industries. And help the FBR in stopping huge tax avoidance. For the tobacco industry If you use the Track and Trace system is applied to all domestic and multinational players. It will help in achieving the goals that are desired. But if illegal cigarettes continue to be sold without interruption and unabated. It won't assist in the actual goals of the scheme. The FBR's chairman FBR stated that the FBR will be bringing 4000 tier-1 retailers. That is integrated into Point of Sale (POS) for the fiscal year that is currently in operation.

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