LCCI raps FBR for anti-busi­ness laws

Busi­ness lobby hails Pak-iran gas pipe­line project

The Pak Banker - - NATIONAL -

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."

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