Chief Justice Umar Ata Bandial of Pakistan has dismissed the notion that the country is on the brink of bankruptcy. He instructed the government to take action against foreign currency smuggling. The three-member bench, led by Justice Bandial, resumed a hearing into a case brought by the Federal Board of Revenue (FBR) challenging a ban imposed by the Lahore High Court (LHC) on collecting a one-time “super tax” from industries.
In June 2022, the government introduced a 10% tax on large-scale industries’ profits in an attempt to ease inflation’s impact on the poor. The FBR aimed to collect Rs250bn in the 2022-2023 financial year from the super tax. The government imposed the super tax on high-earners through the Finance Act 2022 and the insertion of a new section 4C in the income tax ordinance.
Several companies took the matter to the Lahore High Court, resulting in a moratorium on the FBR collecting the super tax. The FBR then appealed the LHC’s decision in the Supreme Court. In the previous hearing on February 6, the Supreme Court modified the LHC’s interim order and directed wealthy taxpayers to deposit half of their super tax dues with the FBR within a week.
Today, the top court sought to club all cases related to the super tax to hear them together. FBR counsel Faisal Siddiqui informed the court that the LHC suspended the implementation of its final decision for 60 days. Barrister Farogh Naseem, representing the companies, argued that all of the FBR’s petitions against the LHC’s interim order were ineffective.
The Chief Justice said the case would be fixed for a hearing next week and that the FBR imposed the super tax in good faith. When Siddiqui stated that he would represent the federal government in the event of a default, the Chief Justice interjected and emphasized that the country was not going bankrupt and that everyone needs to improve in the country’s best interest. The hearing was adjourned until February 16.
