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Tuesday March 19, 2024

FBR, FPCCI at odds over budget proposals

By our correspondents
May 24, 2017

KARACHI: Negotiations between the Federal Board of Revenue (FBR) and business community over budget proposals failed to reach any consensus, as tax authorities show reluctance for inclusion of the same in the upcoming budget.

“The FBR is reluctant to adopt all those proposals that can end corruption in the taxation system,” said Shakeel Ahmed Dhingra, chairman of the FBR committee of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), on Tuesday.

A six-member delegation headed by Qaiser Ahmed Shaikh, chairman of the National Assembly standing committee on finance along with MNAs and representatives of the FPCCI held several meetings with the FBR senior management, including its chairman and members on Monday.

“The FBR officials were less bothered to consider the proposals presented by the FPCCI,” Dhingra said, adding that it had proved that the chambers of commerce had made wise decision for not submitting proposals for the budget 2017/18.

The FBR had retreated at the 11th hour from an agreement between the FPCCI and tax authorities over income tax at import stage for industrial and commercial importers, he said.

The FPCCI had proposed that there should be two percent advance income tax at import stage for industrial importers and such importers would not require to present any exemption certificate.

Further, it was also agreed that the tax rate should be four percent for commercial importers at the import stage, Dhingra added.

The FBR had also refused to bring amendments to two percent additional tax, which would help eliminate flying invoices in sales transactions, he said.   Dhingra said: “The FPCCI recommended drastic changes in sales tax regime because existing one is promoting corruption.”

Another proposal, which came under discussion was regarding Section 8A of the Sales Tax Act under which buyers and sellers are jointly liable to pay amount if the FBR has not received sales tax on such transaction.

Dhingra said it was injustice that a person is penalised for such wrongdoing, which he never committed. He said the FBR also refused to change the certain provision.

In case the FBR does not incorporate such proposals in the budget, the FPCCI along with other chambers would evolve a strategy against the taxation system, he added.