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160
| National Finance Commission.
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(1)
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Within six months of the commencing day and
thereafter at intervals not exceeding five years, the President
shall 382 constitute a National Finance Commission consisting
of the Minister of Finance of the Federal Government, the
Ministers of Finance of the Provincial Governments, and such
other persons as may be appointed by the President after
consultation with the Governors of the Provinces.
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(2)
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It shall
be the duty of the National Finance Commission to make
recommendations to the President as to-
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(a)
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the distribution between the.Federation and
the Provinces of the net proceeds of the taxes mentioned in
clause (3);
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(b)
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the making of grants-in-aid by the Federal
Government to the Provincial Governments;
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(c)
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the exercise by the Federal Government and
the Provincial Governments of the borrowing powers conferred
by the Constitution; and
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(d)
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any other matter relating to finance
referred to the Commission by the President.
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(3)
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The taxes referred to in paragraph (a) of clause
(2) are the following taxes raised under the authority of
383[Majlis-e-Shoora (Parliament)] 383, namely: -
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(i)
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taxes on income, including corporation tax,
but not including taxes on income consisting of remuneration
paid out of the Federal Consolidated Fund;
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384[
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(ii)
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taxes on the sales and purchases of goods
imported, exported, produced, manufactured or consumed;
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] 384
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(iii)
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export duties on cotton, and such other
export duties as may be specified by the President;
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(iv)
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such duties of excise as may be
specified by the President; and
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(v)
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such other taxes as may be specified by the President. |
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385[
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(3A)
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The share of the Provinces in each Award of National Finance Commission shall not be less than the share given to the Provinces
in the previous Award.
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(3B)
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The Federal Finance Minister and Provincial Finance Ministers shall monitor the implementation of the Award biannaully and
lay their reports before both Houses of Majlis-e-Shoora (Parliament) and Provincial Assemblies.
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] 385
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(4)
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As soon as may be after receiving the
recommendation, of the National Finance Commission, the
President shall, by 386 Order, specify, in accordance with the
recommendations of the Commission under paragraph (a) of clause
(2), the share of the net proceeds of the taxes mentioned in
clause (3) which is to be allocated to each Province, and that
share shall be paid to the Government of the Province concerned,
and, notwithstanding the provision of Article 78 shall not form
part of the Federal Consolidated Fund.
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(5)
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The recommendations of the National Finance
Commission, together with an explanatory memorandum as to the
action taken thereon, shall be laid before both Houses and the
Provincial Assemblies.
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(6)
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At any time before an Order under clause (4) is made,
the President may, by Order, make such amendments or modifications
in the law relating to the distribution of revenues between the
Federal Government and the Provincial Governments as he may deem
necessary or expedient.
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(7)
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The President may, by Order, make
grants-in-aid of the revenues of the Provinces in need of assistance
and such grants shall be charged upon the Federal Consolidated Fund.
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161
| Natural gas and hydro-electric power.
387[
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(1)
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Notwithstanding the provisions of Article 78,-
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(a)
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the net proceeds of the Federal duty of excise on natural gas levied at well-head and collected by the Federal Government
and of the royalty collected by the Federal Government, shall not form part of the Federal Consolidated Fund and shall be
paid to the Province in which the well-head of natural gas is situated;
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(b)
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the net proceeds of the Federal duty of excise on oil levied at well-head and collected by the Federal Government, shall not
form part of the Federal Consolidated Fund and shall be paid to the Province in which the well-head of oil is situated.
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] 387
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(2)
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The net
profits earned by the Federal Government, or any undertaking
established or administered by the Federal Government from the bulk
generation of power at a hydro-electric station shall be paid to the
Province in which the hydro-electric station is situated.Explanation
-For the purposes of this clause "net profits" shall be computed by
deducting from the revenues accruing from the bulk supply of power
from the bus-bars of a hydro-electric station at a rate to be
determined by the Council of Common Interests, the operating
expenses of the station, which shall include any sums payable as
taxes, duties, interest or return on investment, and depreciations
and element of obsolescence, and over-heads, and provision for
reserves.
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162
| Prior sanction of President to Bills affecting taxation in which Provinces are interested.
No Bill or amendment which imposes or varies a tax or
duty the whole or part of the net proceeds whereof is assigned to
any Province, or which varies the meaning of the expression
"agricultural income" as defined for the purpose of the enactments
relating to income-tax, or which affects the principles on which
under any of the foregoing provisions of this Chapter moneys are or
may be distributable to Provinces, shall be introduced or moved in
the National Assembly except with the previous sanction of the
President. |
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163
| Provincial taxes in respect of professions, etc.
A Provincial Assembly may by Act impose taxes, not
exceeding such limits as may from time to time be fixed by Act of
388[Majlis-e-Shoora (Parliament)] 388, on persons engaged in professions, trades, callings or
employments, and no such Act of the Assembly shall be regarded as
imposing a tax on income. Miscellaneous Financial Provisions |
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164
| Grants out of Consolidated Fund.
The Federation or a Province may make grants for any
purpose, notwithstanding that the purpose is not one with respect to
which 389[Majlis-e-Shoora (Parliament)] 389 or, as the case may be, a Provincial Assembly may make
laws. |
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165
| Exemption of certain public property from taxation.
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(1)
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The Federal Government shall not, in respect of its
property or income, be liable to taxation under any Act of
Provincial Assembly and, subject to clause (2), a Provincial
Government shall not, in respect of its property or income, be
liable to taxation under Act of 390[Majlis-e-Shoora (Parliament)] 390 or under Act of the Provincial Assembly of any other
Province.
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(2)
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If a trade or business of any kind is carried on by
or on behalf of the Government of a Province outside that Province,
that Government may, in respect of any property used in connection
with that trade or business or any income arising from that trade or
business, be taxed under Act of 391[Majlis-e-Shoora (Parliament)] 391 or under Act of the Provincial Assembly of the Province
in which that trade or business is carried on.
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(3)
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Nothing in this Article shall prevent the imposition of fees for services rendered.
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165A
| Power of Majlis-e-Shoora (Parliament) to impose tax on the income of certain corporations, etc.
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(1)
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393[Majlis-e-Shoora (Parliament)] 393 has, and shall be deemed always to have had, the
power to make a law to provide for the levy and recovery of a
tax on the income of a corporation, company or other body or
institution established by or under a Federal law or a
Provincial law or an existing law or a corporation, company or
other body or institution owned or controlled, either directly
or indirectly, by the Federal Government or a Provincial
Government, regardless of the ultimate destination of such income.
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(2)
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All orders made, proceedings taken and acts done
by any authority or person, which were made, taken or done, or
purported to have been made, taken or done, before the
commencement of the Constitution (Amendment) Order 1985, in
exercise of the powers derived from any law referred to in
clause (1), or in execution of any orders made by any authority
in the exercise or purported exercise of powers as aforesaid,
shall, notwithstanding any judgment of any court or
tribunal,including the Supreme Court and a High Court, be deemed
to be and always to have been validly made, taken or done
and-shall not be called in question in any court, including the
Supreme Court and a High Court, on any ground whatsoever.
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(3)
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Every judgment or order of any court or tribunal,
including the Supreme Court and a High Court, which is repugnant to
the provisions of clause (1) or clause (2) shall be, and shall be
deemed always to have been, void and of no effect whatsoever.
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]
382
For the notification constituting the National Finance Commission, see Gazette of Pakistan, 1974, Extraordinary, Part II,
pages 191-192.
386
For such Order, see the Distribution of Revenues and Grants-in-Aid Order, 1975 (President's Order No.2 of 1975).
387
Substituted by
Constitution (Eighteenth Amendment) Act, 2010, Section 60
(with effect from
April 19, 2010) for :
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(1)
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Notwithstanding the provisions of Article 78
the net proceeds of the Federal duty of excise on natural gas levied
at well-head and collected by the Federal Government, and of the
royalty collected by the Federal Government, shall not form part of
the Federal Consolidated Fund and shall be paid to the Province in
which the well-head of natural gas is situated.
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