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Senate endorses 40-year tax holiday for Gwadar Port and free zone

Senate endorses 40-year tax holiday for Gwadar Port and free zone

ISLAMABAD: A Senate panel on Tuesday endorsed 40-year tax holiday for Gwadar Port and its free zone after the government showed the bilateral agreement to legislators that carried provisions for tax concessions for all including sub-contractors.

The Senate Standing Committee on Finance criticised Maritime Affairs Secretary Rizwan Ahmad for making a misstatement about the time period of tax concessions and exclusion of sub-contractors from the scope of these concessions.

After having a look at the agreement, the standing committee endorsed the tax concessions that the government proposed in the Finance Bill 2020 for Gwadar Port and Gwadar Free Zone. The committee meeting was held in-camera due to the hype created about the nature of Pakistan-China agreement on Gwadar Port.

The proposed amendments were in line with the original 2007 Gwadar Port agreement, according to the standing committee.

“The 2007 and 2013 concession and novation agreements cannot be shared as there is a confidentiality clause in the agreement,” the maritime affairs secretary stated last week during a meeting of the Senate Standing Committee on Finance.

Last week, the secretary also stated that “the original Gwadar Port concession agreement offered only 20-year tax holiday to port operators and there was also no provision for extending the tax concessions to sub-contractors.”

Pakistan has handed over Gwadar Port to China that is developing the deep-sea port as part of the strategic Belt and Road Initiative of the Chinese president.