ISLAMABAD: The government has announced plans to remove cross-subsidies and peak rates from the industrial power tariff. This move is part of the upcoming industrial policy aimed at boosting exports and reducing costs for manufacturers.
Top officials confirmed that the Power Division will oversee the removal of cross-subsidies, ensuring industries pay fair electricity rates. The reform is expected to improve competitiveness and attract foreign investment.
The government is also making legal changes to protect industrialists from arbitrary interference by federal agencies. Amendments to Sections 41B and 42A of the SECP Act 1947 will require approval from the Securities and Exchange Commission of Pakistan (SECP) before any action is taken against regulated entities. This includes protection for stock exchanges, insurance companies, brokers, and non-banking finance companies.
Additionally, the Industrial Policy will simplify tax and refund processes. The Federal Board of Revenue (FBR) will clear pending refunds, including sales tax, customs rebates, and income tax, within a reasonable timeframe. Exporters will benefit from the Drawback of Local Taxes and Levies (DLTL) scheme, announced in coordination with the Ministry of Commerce and the Finance Division.
Industrial gas prices will also see changes, with cross-subsidies removed to reduce input costs for industries. If fiscal space allows after the current IMF program, exporters will be subject to minimum tax, similar to other businesses, collected quarterly.
The policy further includes reforms in insolvency and corporate restructuring. Amendments to the Corporate Rehabilitation Act 2018 and the Corporate Restructuring Companies Act 2016 will broaden the scope for eligible debtors, simplify processes, and protect companies during restructuring.
Experts say these measures under the industrial power tariff reform initiative aim to create a transparent, business-friendly environment. By reducing operational costs and legal uncertainties, the government hopes to encourage investment and stimulate economic growth.
For related updates, read how NEPRA cuts power tariffs by Rs1.79 per unit.
