Harassment of taxpayers: FBR chief has agreed to resolve the issue: FPCCI chief – Business & Finance

KARACHI Atif Ikram Sheikh, President of FPCCI, has informed that Rashid Mahmood Langrial, Chairman of Federal Board of Revenue (FBR), in an exclusive, frank and detailed meeting, has agreed to FPCCI’s demand for an end to the harassment of genuine and regular taxpayers – and only tax evaders or defaulters should be issued notices.

The FBR chairman, however, demanded that FPCCI should support FBR’s efforts to convince all traders and industrialists to file their returns in a fair, legitimate and transparent manner.

Following which, the high-profile FPCCI delegation agreed to assist FBR; when the tax collection machinery is managed and policy making takes place in a consultative style.

Atif acknowledged that the requirement of signing an affidavit by the Chief Financial Officers (CFOs) of companies has been withdrawn by FBR following special request from FPCCI. It was intrinsically unnecessary and superfluous as the Sales Tax Act 1990 already provides ample scope for responsible filing of sales tax returns, he added.

Saquib Fayyaz Magoon, SVP FPCCI, noted that FBR’s revenue collection target is Rs. 12.97 trillion – representing a 40 percent increase year-on-year – while the economy is growing only 2 to 3 percent. This is a major concern for the business community; and could result in new taxes, mini-budgets and further burdening those already burdened.

Magoon claimed that the Finance Bill has significantly reduced business confidence in government policy due to the abrupt withdrawal of full and final 1 percent liability for exporters; and exemption from sales tax on local supplies to registered exporters authorized under the Export Finance Scheme (EFS).

The SVP FPCCI highlighted that the Tajir Dost Scheme (TDS) was also implemented without consultation; and in fact, it has been found that TDS has missed its revenue collection target by 99 percent.

Magoon highlighted that FPCCI has raised the issue of SRO. repeatedly 350 (I)/2024; and despite being amended twice, it remains problematic – only because it was issued without consultation with stakeholders. FPCCI strongly advocates effective revival and expansion of the Alternate Dispute Resolution Committee (ADRCs) in the areas of Customs, Sales Tax, Federal Excise and Income Taxes, he added.

Saquib Fayyaz Magoon suggested that the Export Finance Scheme (EFS) should be simplified as it takes 3 to 4 months to complete the process due to complex procedures, issuance of duplicate documentation and system issues. Moreover, there are no provisional quotas; the transition between business structures and multi-product output from single inputs.

Magoon warned that the inclusion of EPZs in the regular tax system will result in huge losses and resentment among investors. Moreover, local industry is also excluded from EFS; whereas exporters have been unfairly excluded from the Final Tax Regime (FTR). FPCCI again demands resolution of these discrepancies, he added.

Khurram Ejaz, Member of Prime Minister’s Committee on Transversal Ports and Advisor to President FPCCI on FBR Affairs, wondered why Pakistani ports and terminals cannot conduct 24×7 survey, delivery and handling like the rest of the world. He demanded that FBR’s LIVE project be implemented to resolve customs assessment issues; Modernized laboratories need to be installed and residence times need to be reduced.

Rashid Mahmood Langrial, Chairman FBR, agreed that tax rates should be reduced to reduce tax burden and improve compliance; However, this is not possible under the current circumstances. He added that the past two to three years have been very painful for the economy; but economic indicators are starting to show improvement.

The FBR Chairman stated that he agrees in principle with the demands and proposal of FPCCI on withdrawing the affidavit in respect of sales tax returns; ambiguities in SRO. 350; ports and shipping matters; need for a consultation process and the need for complete digitalization of the FBR system.

Muhammad Ayub, Chairman of Quetta Chamber of Commerce and Industry (QCCI), raised the issue of stuck and delayed cargo containers in Panjgur; which must be released quickly after payment of any outstanding duties. To which the Customs at FBR has agreed to resolve the issue after collecting the dues; and help save affected merchants from further delays and losses.

Dr. Jassu Mal, representative of cotton ginning companies, highlighted the plight of the sector as it has to pay taxes on every stage of cotton production – causing cotton prices to rise at many different levels and making it uncompetitive.

Copyright Businessrecorder, 2024