Talks on agri tax remain inconclusive

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Talks between the Centre and the provinces on the imposition of agriculture income tax through better mechanism remained inconclusive on Tuesday as the provinces said floods and the security situation were hampering realisation of potential proceeds. According to an official source, in the meeting chaired by Finance Minister Hafeez Shaikh, the provinces rejected the federal government’s demand to treat the agriculture income as normal income. They made it clear that it was a provincial subject and every province had different issues which would be decided by them alone. They also sought details of the agriculture income filed by tax payers to the Federal Board of Revenue.
Talking to reporters after the meeting, Khyber Pakhtunkhwa Finance Minister Humayun Khan said the agriculture income tax was imposed in the province since 2000 and only Rs 1.9 million per annum were being generated. Senior Punjab Minister Zulfiqar Khosa said the meeting discussed some proposals but more time was required for deciding on the issue as it was the committee’s first meeting. He said the issues of every province were different and required more time. The Balochistan finance secretary said the province’s agriculture was in a bad shape after the floods and efforts were needed to rebuild the damaged infrastructure. He said the province generated Rs 65 million from the agriculture tax last year. However, he said after the floods the provincial government had to supply free seeds and fertilizers to help the growers.
The meeting also asked the FBR to furnish details of the potential of the agriculture income tax in provinces during the next meeting.