Finance Minister, Senator Mohammad Ishaq Dar, chaired a meeting on Friday at the Ministry of Finance on matters related to the Federal Board of Revenue (FBR). Chairman FBR briefed the Finance Minister on the progress of tax collection during the current fiscal year, and the targets for FY 2017-18.
The Finance Minister urged FBR to take all necessary measures to meet the tax collection target for the current fiscal year. He said that the tax measures, which have been proposed in the budget for FY 2017-18, are based on extensive consultations with all relevant stakeholders. He expressed the confidence that the measures announced in the budget will enhance the welfare and prosperity of the general public, and enable Pakistan to achieve higher, sustainable and inclusive economic growth. He added that the government will welcome all constructive and positive suggestions regarding the budget from parliamentarians during the ongoing budget session in Parliament. The Finance Minister directed FBR to finalize a tax revenue collection strategy for the next year in a timely manner in order to effectively pursue the tax collection targets for FY 2017-18 .
Special Assistant to Prime Minister on Revenue, Mr. Haroon Akhtar Khan, Finance Secretary, Secretary EAD, Chairman FBR, and senior officials of the Ministry of Finance and FBR attended the meeting.
Jul 01, 2022: Minister of State for Energy Mohammad Hashim Notezai on Friday said that additional 5,000 megawatts electricity would be added in the system by March 2023.
Addressing the people during an open katcheri at Circuit House Khuzdar, the minister deplored that due to unavailability of fuel, 5739 MW capacity is cut off, with fuel’s availability, this will start working and will be added into the main grid.
“Due to increasing heat energy crisis has intensified in the country", he said and gave credit to the incumbent government for its timely measures and making 3,000 MW available to the public.
The minister apprised that the government has inked an agreement with Iran for supplying 100 MW power to Makran division in Balochistan.
He appealed to the customers to submit their bills on time and cooperate with the QESCO for uninterrupted supply of electricity.
Deputy Commissioner Khuzdar Major retired Muhammad Ilyas Kabzai, SSP Javed Iqbal Gharshin and Assistant Commissioner Jahanzeb Shahwani, were also present.
July 1, 2022: Federal Board of Revenue (FBR) has uploaded the Income Tax Return forms for tax year-2022, a press release issued said today.
Separate Income Tax Return forms for Salaried, Association of Persons (AOPs), Business Individuals, and Companies have been uploaded. The Income Tax Returns can be filed through FBR's Web Portal (Iris System), and Tax Asaan application.
In a press statement, FBR has further stated that taxpayers are provided complete guidance about filling all the required particulars in the form. The Income Tax Returns can be filed online also through smartphones by installing the Tax Aasaan application from Google Play Store/App Store.
However, to maximize general awareness, a media campaign will soon be launched for taxpayers' facilitation and public awareness.
The Salaried/ Business Individuals & AOPs can file their Income Tax Returns by 30th September 2022 whereas companies can file Income Tax Returns according to their due dates.
July 1, 2022: In light of the ongoing power supply constraints, K-Electric today announced a rationalized load-shed schedule for its customers. The revised schedule is effective July 1, 2022. This step is being taken to provide relief to customers experiencing night-time load-shed in high-loss areas.
The shortfall in KE territory has increased from an average of 250 MW – 350 MW to almost 450 MW – 500 MW due to rising temperatures and curtailed fuel supply. Moreover, the shortfall persists round the clock making the nighttime load shed unavoidable. KE is also facing a power supply constraint due to reduced gas supplies from SSGC, which is down to approximately 90 MMCFD versus the 200 MMCFD gas that was supplied last year.
Consequently, two plants in KE's system, one at SITE and one at Korangi, with a combined generation of 200MW, remain non-operational. The release of KE dues from the government against tariff claims will enable KE to pay fuel suppliers in full and negotiate for more gas.
As per KE Spokesperson, “This revision in timing is in line with our discussion with various stakeholders including the Ministry of Energy Sindh as well as Commissioner Karachi. We are making every endeavour to seek support in mitigating these issues. Unfortunately, at this time there is a power shortfall at the national level as well as a shortage of gas and RLNG in the country. We are grateful to the Minister of Energy Imtiaz Sheikh for his pledge to solicit additional power and gas to further reduce the night-time load-shed. In the meanwhile, and due to limited and finite energy sources, we have redistributed the load-shed timings amongst the customers.”
"The updated schedule of the new load shed regime has been made publicly available on KE's website. Consumers can use their account numbers to find their individual schedules. KE is also duly communicating to registered consumers via KE's SMS service. With that said, the uninterrupted power supply will continue to feeders powering Karachi’s industrial zones and strategic feeders including those energizing KWSB and strategic installations such as Karachi Airport," the spokesperson added.
The load-shed schedule in place is applicable on a daily recurring basis. Interruptions in power supply due to necessary maintenance on the network, or due to technical faults should not be equated with load-shed. KE teams remain active to rectify known issues. Any customer-facing an outage of more than 30 to 40 minutes outside of their load-shed timings is requested to check their KE Live app for an update on their power status; KE’s call center 118 also remains available 24/7.
With reports of protests being received from across the city, spokesperson KE stated, “This is a difficult time for the country in terms of the power supply situation. Global economic challenges are creating vulnerabilities in the fuel supply chain, which is also affecting K-Electric. We sincerely apologize for the inconvenience being caused to our consumers. While we recognize the right to protest, at the same time we request our citizens to maintain peace. Over the last 30 days, various KE offices have been the target of protests, which are impairing KE’s ability to conduct its operations in the city.”
KE continues to closely monitor the system, adjust and communicate any changes as may be necessary. The utility appeals to the citizens of Karachi to limit the impact of the shortages by continuing to reduce the usage of electricity by at least 20% and switching off all non-essential items.
Sharing a recent power supply update to the city, the KE spokesperson in their message via social media also shared, "Total average power supply in KE's service territory was around 2900MW on 30th June 2022."
July 01, 2022 (MLN): Energy inflation driven by the withdrawal of fuel and electricity subsidies pushed headline inflation to touch a 13-year high of 21.3% in June 2022 from 13.8% in May 2022 and 9.7% in June 2021, taking a serious toll on consumers’ real income.
June’s inflation reading accelerated past the market expectation, making a strong case for another rate hike in the upcoming monetary policy.
On a sequential basis, inflation rose by 6.34%, compared with 0.4% in the previous month, powered by a massive rise in fuel prices due to higher international oil prices and the end of subsidies in order to revive the stalled IMF program. This led the transport index to surge by 24.4% MoM on the back of the average increase in petrol and diesel prices by 39% and 48%, MoM, respectively.
The recent data from the PBS confirmed that, in June, there were jumps everywhere on a sequential basis including food group and housing index, thanks to a continuous rise in perishable and non-perishable food items and an increase in energy tariffs.
In broad inflation, the food basket witnessed a 5.5% MoM as visible jumps were seen in the prices of potatoes, eggs, pulses, vegetable ghee, and cooking oil amid higher palm oil prices and the currency depreciation, showing an increase of 12%-35%.
While the housing index (weight: 23.6%) grew by 7.7% MoM as the electricity tariff was increased by 6.08% MoM. The index is expected to increase further in July due to an increase in base tariff by Rs7.9 per unit.
In addition, an increase in beverages also added inflationary outturns in June by 7% MoM due to a continuous rise in the prices of tobacco.
On the yearly basis, the increase in CPI was led by the increase in transport, food, restaurants & hotels, household & equipment maintenance, beverages, miscellaneous, clothing & footwear, and housing index by around 62%, 26%, 22%, 19%, 17.6%, 16%, 13.7% and 13.5%, YoY, respectively.
Region-wise, Urban CPI observed an increase of 6.19% MoM and 19.84% YoY in June 2022 while Rural CPI went up by 6.57% MoM and 23.55% YoY during the said month.
Meanwhile, urban core inflation measured by non-food, non-energy (NFNE) accelerated in June 2022 to 11.5% on yearly basis from 9.7% in the previous month whereas, rural core inflation on YoY increased to 13.6% in the month under review when compared to 11.5% recorded in May 2022.
Outlook
In these unprecedented times, a sharp rise in commodity prices and supply bottlenecks are exerting inflationary pressures on countries that are net importers of oil. Pakistan is also of them which is bearing the brunt of high inflation.
The fiscal year 2022-23 is expected to be a difficult year as headline inflation may settle in between 15-20%, the market expects with the risk tilted to the upside on the back of currency depreciation and rising fuel prices from levies and taxes as the government brings budgetary changes.
This eventual rise of more than decade-high inflation has made some room to increase the policy rate to cool down this inflation.
Despite SBP’s actions regarding enhancing liquidity, more importantly, to align with the proposed fiscal contractionary settings of Budget FY23, the market experts believe that the SBP would raise the policy rate by a further 50-150 bps in the upcoming MPC meeting on the 7th July 2022, in view of higher inflation forecast and likely agreement with the IMF.
While the IMF program remains critical, the conditions leading to a successful IMF Staff level agreement are inflationary in nature due to the resumption of PDL and GST on POL products, rationalizing electricity and gas tariffs, and further monetary tightening, a report by JS Global said.
While the latest Bloomberg report said that the country would probably have to increase the policy rate by 50 bps in the next quarter before it receives IMF cash.
July 1, 2022 (MLN): Following the hike in petroleum product prices, the Oil and Gas Regulatory Authority (OGRA) on Friday, increased Liquefied Petroleum Gas (LPG) price by Rs1.66 per Kg for the month of July.
Hence, the new price of LPG now stands at Rs220.42 per kg, while the domestic cylinder will cost around Rs2,600.97.
Meanwhile, it is important to note that the government had fixed the LPG price at Rs218 per Kg for June and the domestic cylinder cost around Rs2,581.
Yesterday, the governmentdecided to increase the petrol prices by Rs14.85 to Rs248.74 per litre while imposing a Petroleum Levy (PL) of Rs10 per litre. This is the fourth consecutive hike in fuel prices since May 26.
“In view of the fluctuations in prices in the international market and exchange rate variation, the government has decided to partially apply the petroleum levy and revise the existing prices of petroleum products as agreed with the development partners", Finance Division said.
Following the announcement, high-speed diesel is now priced at Rs276.54 per litre (up by Rs13.23), kerosene oil at Rs230.20 per litre (up by Rs18.83) and light diesel at Rs226.61 per litre (up by 18.68).Meanwhile, Rs5 has been applied as PL on each high-speed diesel, kerosene oil and light diesel.
