KARACHI: Sindh Chief Minister Murad Ali Shah on Monday said that the Sindh government has been facing unauthorized deductions over past years by Federal Board of Revenue (FBR) in connection with withholding tax and sales tax on goods from the Provincial Consolidated Fund (PCF), in violation of the constitution.
Presiding over a meeting at the CM House to review the said deduction by FBR, the chief minister said that in the year 2012-13, Rs633.119 million were unconstitutionally deducted by FBR from PCF as a withholding tax.
In 2015-16, Rs6127.115 million were deducted and in 2016-17 another Rs294.5 million were deducted, which takes the total amount deducted in the last three financial to Rs7054.734million.
The FBR has also deducted various other amounts from the PCF, in respect of claims over different departments of the Sindh government with respect to Sales Tax.
The chief minister quoting Article 119 of the Constitution said that the custody of the provincial consolidated fund and the authority to withdraw money from it rests with the provincial government. He added that any arbitrary withdrawal of money from the PCF by FBR is a clear violation of the constitution.
He said that Article 121(d) of the constitution specifies that the expenditure can only be made from PCF for any sum required to satisfy any judgment, decree or award against the province by any court or tribunal.
The chief minister also decided to write a letter to the prime minister with the request to direct Ministry of Finance to refund the amount of Rs7.054 billion to Sindh government with respect to withholding tax which has been unconstitutionally deducted by FBR from PCF.