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NBR opposes provision of superseding [ FIRST PAGE ] 21/03/2017
Draft energy dev fund law
NBR opposes provision of superseding
Doulot Akter Mala

Government\'s revenue authority disapproves of a provision in the draft gas, petroleum and mineral resources development fund law as it fears superseding any other law may disturb fiscal discipline.

Officials said the income-tax wing of the National Board of Revenue (NBR), in its vetting of the draft law, recommended that the discretionary provision of the drafts law be deleted.

The vetting outcome has been sent to the secretary of the ministry of energy and mineral resources recently.

On a close scrutiny, the income-tax wing observed that the provision of superseding other laws may frustrate the legislative discipline as many of the special new laws are incorporating the provision of overriding.

"As per fiscal law, the government has empowered the tax law to overrule any other law for the sake of internal revenue protection," said a senior NBR official.

In the Finance Bill 2016, the Income Tax Ordinance 1984, section 184 F, income tax ordinance gets preferences to any other laws on imposition and collection of income tax, income-tax exemption, tax cuts, gathering information for the imposition of tax and maintaining privacy of tax-related information.

"Income tax matters will get preferences too on the proposed gas, petroleum and mineral resources development fund law 2016," the NBR said in the vetting report.

It has been noticed that many of the draft laws are incorporating such provision emboldening their respective special laws, which may disrupt the fiscal discipline, he added.

The income-tax wing has issued vetting report recommending for the authorities concerned to scrap the provision, he further informed.

Confusion and complexities might arise if such provision of \'superseding any other law\' is incorporated into all of the new draft laws.  It may puzzle the people concerned.

However, the draft law is a special law and will get preferences over the general laws, it added.

In the vetting, the Value Added Tax (VAT) wing also gave its vetting suggesting depository of VAT and Supplementary Duty (SD) of the fund to the public exchequer.

The law on the anvil has incorporated a provision on depository of VAT and SD in the gas, petroleum and mineral resources fund.

"As per existing revenue law, there is no scope to deposit VAT and SD into other funds as it is a part of integrated fund of the government," it said.

Also, if any additional amount of VAT is collected from consumers, it should be refunded to the consumers rather than keeping the amount with fund of any of the organizations. The additional VAT should be also deposited under the VAT code of the government exchequer.
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