KARACHI: The Sindh Revenue Board (SRB) has notified Mutual Funds Association of Pakistan (Mufap) that Sindh Workers Welfare Fund (SWWF) at the rate of 2 per cent is not applicable to mutual and pension funds.

The net asset values (NAVs) of such funds have got a boost, as the asset management companies have notified the bourse that they stopped further provisioning and reversed the accrued provision of SWWF from the books on mutual funds and pension funds under their management.

“The decision is accordingly implemented, which made [a] positive impact on the net asset values (NAVs) of the mutual funds and pension funds under the management,” Al-Meezan Investment company secretary Syed Owais said in a filing.

As a consequence of the 18th Amendment to the Constitution of Pakistan, in May 2015, the Sindh Workers’ Welfare Fund Act, 2014 (SWWF Act) was passed by the government of Sindh as a result of which every industrial establishment located in Sindh, the total income of which in any accounting year is not less than Rs0.50 million, is required to pay the Sindh Workers’ Welfare Fund (SWWF) in respect of that year a sum equal to 2 per cent of such income.

The matter was taken up by the Mutual Funds Association of Pakistan (Mufap) with the SRB, contesting that the mutual funds should be excluded from the ambit of the SWWF Act, as these were not industrial establishments but were pass through investment vehicles and did not employ workers.

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