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Aftab Maken
ISLAMABAD: The Senate Standing Committee on Finance has rejected key proposals in the finance bill 2025-26 which include a Rs 2.50 per liter carbon levy on petroleum products, the removal of the 10% debt servicing surcharge cap on electricity users, and the imposition of a levy on small vehicles.
The committee met under the chairmanship of Senator Saleem Mandviwalla to discuss budget recommendations in detail and hold debate on the Public Finance Management (Amendment) Act.
According to the Ministry of Finance, the proposed amendment would allow autonomous institutions to retain and spend their income instead of depositing it into the national treasury.
However, Senator Anusha Rehman strongly opposed this move, saying such institutions should be obligated to submit their income and profits to the national exchequer. She also demanded to see the balance sheets of these institutions.
During the session, Senator Faisal Vawda highlighted that State Life Insurance had invested billions of rupees in the stock market. Finance Minister agreed with the concern, stating that no institution should keep its profits, especially at a time when the country is under a growing debt burden.
The committee also rejected the proposal to remove the 10% cap on the debt service surcharge for electricity consumers. Officials argued this was part of the IMF conditions, enabling the government to increase the surcharge during financial needs.
Senators Saleem Mandviwalla and Faisal Vawda opposed this, expressing concerns over putting further financial pressure on electricity consumers.
The meeting did approve a few budget proposals, including:
- Imposing a tax on annual pensions exceeding Rs 10 million
- Granting income tax exemptions to international athletes
- Providing tax relief to economic zones and special technology zones
FBR Chairman informed the committee that the government is gradually phasing out general tax exemptions.
Meanwhile, the proposed Rs 2.50 per liter carbon levy on petroleum products for the next fiscal year was rejected by majority vote. Senators Sherry Rehman, Shibli Faraz, and Faisal Vawda strongly opposed it, calling it an additional burden on the common man.
The committee also turned down the proposal to impose 1%, 2%, or 3% levy on small vehicles, saying it would impact middle-class car owners.
