Pakistan has a bullion market worth Rs2.2 trillion but only Rs29 billion is declared with the tax authorities, as around 80 tons of gold was smuggled into the country annually, the Senate Standing Committee on Finance was informed on Thursday.
The committee met here with Senator Talha Mahmood in the chair to review the Finance Amendment Bill. During the meeting, Representatives of the Gold Association pointed out that there was no policy and tax system for gold import in Pakistan.
A Commerce Ministry official informed the committee that the import of gold was not allowed on a commercial basis. He added that the importer would have to arrange the amount in dollars on his own for the import of gold.
An FBR official pointed out that 160 tons of gold were used annually in Pakistan, out of which 80 tons were smuggled into the country. The association’s representative replied that not only gold, but diamond also came through smuggling.
The FBR official further said that the gold market in Pakistan was worth about Rs 2.2 trillion but only the Rs29 billion market was declared with the FBR. He added that among 36,000 people associated with the gold market, only 54 goldsmiths pay taxes.
After a detailed review of the matter, the committee rejected the proposal for increasing the sales tax on gold from 1.5 to 17%. It directed the commerce ministry to take steps to curb gold smuggling.