- Top Short requests files on revenue and super fiscal use.
- The lawyer maintains that Super Tax was temporary but remained for years.
- FBR defends the Super Tax as a source of financing for the fight against terrorism.
Islamabad: At the hearing of the Supreme Court on the Super Tax affair, judge Muhammad Ali Mazhar wondered if the super tax, initially imposed for a specific purpose, would continue until the end of time.
A constitutional bench of five members, led by judge Amin-Ud-Din Khan, heard the case, lawyer Makhdomo Ali Khan representing the companies involved.
Makhdomer Ali Khan informed the court that the government introduced the tax on the super-pronouncement in 2015 to finance the rehabilitation of the areas affected by Operation Zarb-Ezb.
He declared that the government imposed the super tax thanks to the monetary bill of 2015 as a punctual measure. However, he remained in place from 2015 to 2022.
Initially, the government was aimed at perceiving around 80 billion rupees, but it is not clear how much income was really generated by this tax. He urged the court to question the government on the total amount collected under the super tax.
Justice Jamal Khan Mandokhail asked if files were available concerning the total income received from the Super Tax. Khan replied that no Minister of Finance had never mentioned the recovery or the expenses of the super tax in any speech.
Judge Mandokhail noted that the super tax was intended for the rehabilitation of people affected by the military operation, adding that terrorism remains a daily challenge. He questioned the total number of displaced people and the specific areas affected by the operation.
The Supreme Court judge also asked the government’s rehabilitation plan for the affected areas, if a PC-1 had been prepared for the resettlement of displaced persons and if cost estimates had been calculated. He also asked if the taxes on services could be imposed by a money bill.
In response, Khan argued that the government had already noted income tax on income, and to avoid double taxation, he had named it super taxes. He also pointed out that social well-being had been devolved to the provinces, which means that it was not a great tax but simply another tax.
Judge Mazhar reiterated that the super tax had been introduced for a specific purpose and wondered if it would continue indefinitely. Judge Amin-Ud-Din expressed his concerns about how the funds of the Consolidated National Fund could be spent without the consent of the provinces.
At this stage, the lawyer for the Federal Board of Return (FBR), Raza Rabbani, argued that the war against terrorism was a continuous process and that the victims of terrorism were moved due to the efforts to fight terrorism. Khan then wondered if terrorism ended in 2020, because the government had stopped perceiving the Super Tax that year.
The constitutional bench of the Supreme Court then postponed the hearing until tomorrow (Wednesday).
It should be mentioned that the Government of Pakistan Muslim League-Nawaz (PML-N) introduced the Super Tax in 2015, applying it to rich individuals, associations of people and companies with profits exceeding 500 million rupees.
The tax imposes a rate of 4% on income from bank companies and 3% in other sectors, income to finance the rehabilitation of temporarily displaced persons.