ISLAMABAD: A five-member Constitutional Bench of the Supreme Court, led by Justice Aminuddin Khan, presided over the super tax hearing today. Lawyer Farogh Naseem, representing various taxpayer companies, continued his arguments in today’s hearing.
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The bench raised questions about the status of pending cases related to the amendment to Section 99D of the Income Tax Act in other high courts. Justice Jamal Mandokhail asked whether the remaining high courts, specifically the Islamabad High Courts (IHC) and Lahore High Court (LHC), had issued any decisions. Naseem responded by confirming that the Sindh High Court (SHC) had dismissed the petition, while the cases in IHC and LHC were still pending.
Lawyer Naseem also elaborated on the broader implications of the super tax, saying that “currently, banks are being taxed, and the amendment covers all sectors. The tax burden on banks stands at 43 per cent, with an additional 10 per cent super tax, pushing the total rate to 53 per cent.”
He added that this tax system affects various sectors, regardless of their nature, noting that the “wheel of the economy” continues to turn, even amid economic challenges. He also pointed out that many businesses had moved their operations to countries in Africa due to the taxing environment in Pakistan.
Justice Aminuddin Khan expressed concerns about the lack of think tanks in the country, especially in reference to the broader economic and taxation issues.
The counsel also criticised the government’s handling of the situation, accusing officials of providing misleading briefings to key decision-makers including the leadership of the key tax authorities. He said, “If the courts do not provide relief to the taxpayer, then who will be the victim?” He also urged the court to approve the appeals, citing issues with the draft of the law.
The bench also discussed the broader constitutional and parliamentary implications of the super tax. Justice Jamal Mandokhail highlighted the importance of the constitution, stating, “The Constitution is made by the Parliament.” Naseem responded by saying that while the Constitution holds significant weight, Parliament still wields considerable power globally.
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At one point, Justice Muhammad Ali Mazhar questioned the ambiguity of Section 4C in the law, noting that it did not clearly mention the additional tax. “If additional tax had been explicitly stated, you wouldn’t have had a problem,” he suggested. Naseem agreed, acknowledging that clearer language could have avoided confusion.
The hearing continues, with the constitutional bench examining both the legal and constitutional complexities of the super tax and its potential impact on the economy.