NFC to meet by end of this month ISLAMABAD: After pressure from provinces, the federal government has decided to convene a meeting of the National Finance Commission in the last week of this month to move forward on next award for distribution of divisible pool taxes for the next five years.
The decision was taken at a meeting presided over by Finance Minister Ishaq Dar to review the progress so far achieved by the working groups constituted by the NFC early last year, according to an official statement.
The decision came after provinces asked the Centre to transfer control over collection of royalties on oil and gas produced in their respective areas.
The first meeting of the current NFC, held on April 28, 2015, constituted four working groups. The Thursday meeting was informed that draft reports of the four working groups on resource mobilisation, devolved versus integrated tax structure, allocation efficiency and expenditure analysis and rationalisation of subsidies and grants have been completed.
Sindh says Centre should surrender its right to collect royalties on oil and gas and sales tax on goods
The initial reports of the three groups were discussed in a meeting held on Sept 5, 2016, in Lahore and the fourth report was now complete for sharing with the provincial governments.
The minister stressed the need to double efforts, both at federal and provincial levels, to increase revenue mobilisation in order to spur economic growth. As initial work has been completed, it’s time to move to the next steps for completion of the award, he said.
He called for increased focus on resource mobilisation and strengthening of relations between the federation and provinces to achieve national harmony and partnership on the path to development and progress.
He directed the relevant federal ministries to complete inter-ministerial consultation on recommendations of the four working groups by the end of next week. He also directed that the next NFC meeting should be convened by the end of this month.
Earlier on Thursday, a statement issued by the Sindh’s private member on NFC Senator Saleem Mandviwalla said the provinces would write a letter to Prime Minister Nawaz Sharif to convene a meeting on new NFC award at the earliest. He demanded that the Centre should surrender the right to collect royalties on oil and gas and sales tax on goods to the provinces.
“Provinces should be allowed to collect these royalties on oil and gas instead of federal government collecting them and distributing them among provinces,” he said, adding that the provinces were not aware of the collection of these royalties because the Centre was not providing any details.
He said it was also a demand from the provinces that they should be given the right of collecting sales tax on goods because it was their basic right which was being denied even after the 18th Amendment.
The senator also criticised the federal government for delaying the new NFC and said the Centre did not seem interested in the matter. This attitude could have far-reaching impacts, he warned.