KARACHI: The Federal Board of Revenue (FBR) is likely to withdraw several duty and tax exemptions granted through the statutory regulatory orders (SROs) to boost the tax revenue collection, an official said on Wednesday.
“The FBR has started budget exercises and is considering to withdraw various exemptions (on import stage) in the budget 2016/17 to create equality in the system,” the official said.
The official said SROs, particularly SRO NO.1125/2011, were widely being misused and causing revenue loss to national exchequer. The said SRO provides duty/tax concessions on import of raw material by the registered manufacturers.
The official said the ambit of the said SRO might further be limited, which could result in a significant addition to the revenue collection.
The official added that several income tax exemptions and concessions may also be withdrawn.
The official said the minimum rate of customs duty may further be increased. The government fixed the duty at one percent in the budget for the current fiscal year.
Currently, Part I of the Second Schedule of Income Tax Ordinance 2001 consists of various exemptions, which have been granted on the basis of specific entity, nature of income, geographical source of income and other related function.
Tax experts advised the authority to revisit the exemptions. “They should be in line with the government economic policy and help in generation of business activities, employment and well-being of the society,” said an expert.