LCCI raps FBR for anti-business laws
Business lobby hails Pak-iran gas pipeline project
The Lahore Chamber of Commerce and Industry (LCCI) on Monday urged the Federal Board of Revenue to stop immediately extraordinary taxation measures against law abiding tax payers, who are already burdened with high rates of sales tax, income tax and custom duties.
In a statement issued here, the LCCI President Farooq Iftikhar, Senior Vice President Irfan Iqbal Sheikh and Vice President Mian Abuzar Shad said that the of SROs and amendments in various sections in recent days are creating multiple problems for the business community therefore the FBR should focus on expansion of tax net instead of coming with new taxation measures against existing tax payers.
They said that the FBR should ensure some relief to the businesses by taking remedial measures to avoid serious threats to trade and industry. The LCCI office-bearers were of the view that the SRO 98(I) 2013 and SRO 140(I) 2013 would not only increase the financial cost of the businesses but would also be hitting their cash flows hard. Specifically talking about SRO 98(I) 2013, they said, it would come in the way of documentation of the economy because either the manufacturers or importers would start making supplies to unregistered persons or to such registered persons who are not withholding agents. On the other hand, they said, the withholding agents would also be facing great difficulties in getting raw material from registered persons. And theses withholding agents would, therefore, change their status from companies to AOPs or to Sole Proprietorship. "We need business friendly policies to boost our businesses but it is unfortunate the authorities on the helm of affairs are creating more irritants to retard the economy."
They further said that these changes would not add revenue to the government exchequer rather they would create hardship for smooth running of businesses that are already suffering from liquidity crunch.
They said that the SRO would be a blow to the eco- nomic activities that are facing an inertia- like situation because of unavailability of gas, electricity and law and order situation in parts of the country. The LCCI officebearers said that the Federal Board of Revenue should concentrate on expansion of tax base by bringing the undocumented sectors into the tax net rather than squeezing the sectors which are already documented.
They said that it was very unfortunate that the SRO was issued without any prior notice or consultation with business community. They said that the role of the FBR should not be only to collect taxes but to ensure enabling business environment in the country. "The SRO 98(I) 2013 says that all companies as defined in Income Tax Ordinance, 2001 as are registered for sales tax, FED or Income Tax, shall be subjected to Withholding Tax at one-fifth (l/5th) of the applicable rate of sales tax on all purchases." Furthermore, the persons registered as exporters are also now to be subjected to withholding tax of one-fifth (l/5th) of the applicable rate of sales tax on all purchases from registered persons."