Chinese firm could drop mega hydropower project's construction under CPEC due to tax issue: Report
Jan 21, 2022
Islamabad [Pakistan], January 21 : A Chinese company could stop of construction of a mega hydropower project construction under CPEC in Pakistan Occupied Kashmir (PoK) over the issue related to the adoption of one percent fixed tax, a media report said.
The government should immediately take up and resolve this issue since it is a major hurdle in the way of launching construction of mega hydropower project agreed to be completed under the China-Pakistan Economic Corridor (CPEC), reported Dawn citing an official.
"If the issue is not resolved, the Chinese may drop this project from the CPEC's list of projects," Dawn quoted the official as saying.
The Chinese company has asked the government to immediately resolve the issue related to the adoption of one per cent fixed tax by the PoK on the offshore procurement contract of the 1,124-megawatt Kohala Hydropower Project and imposition of 17 per cent sales tax on all imports as proposed in the Finance (Supplementary) Bill 2021, according to Dawn.
The PoK has not yet adopted the ECC decision of one per cent final and fixed tax on the offshore procurement contract for the Kohala HPP. The issue was recently discussed in the company's board meeting, according to Dawn.
It came as goals envisaged under the China Pakistan Economic Corridor (CPEC) inevitably hinged upon the security of the mega project to boost the confidence of businesses and attract massive investments in Pakistan, observed Pakistan's parliamentary committee earlier in January.
"Ensuring robust security of CPEC is of vital importance. All the quarters concerned need to eliminate bottlenecks pertaining to the project's security and ensure that CPEC culminates in the attainment of the desired results," Dawn had quoted the chair of the committee Sher Ali Arbab as saying.
