FAISALABAD City News

FCCI chief urges govt to review taxation strategy
From Our Correspondent
FAISALABAD: Faisalabad Chamber of Commerce and Industry president Engineer Rizwan Ashraf Monday said the Federal Board of Revenue (FBR) had failed to achieve its targets.
In a statement, he said because the FBR could not widen its tax net so the government should review its overall taxation strategy in line with the prevailing ground realities.
He said apparently the government wanted to achieve twin objectives of levying 0.6 % advance income tax on bank transactions by non-filers. Among these include generation of revenue for national kitty and force non-tax payers to come into tax net. However, the instrument of 0.6 per cent advance income tax on bank transaction which has now been reduced to 0.3 per cent on protest of traders and businessmen has failed to yield the required results. Immediately after deduction of advance income tax, most of the account holders preferred to withdraw their maximum deposits and tried to keep themselves out of the banking channels.
At the same time business of “Hundi” flourished. He recalled the previous attempt of levying 1 per cent additional tax on non filers and this attempt also failed as projected government collection declined due to this step. He said the government should learn from these attempts and now revisit its taxation policy in line with ground realities. However, comprehensive negotiation and consultation with all stakeholders is must before finalizing any policy. It will defiantly make this policy acceptable to major chunk of the business community, he added.
The FCCI chief said un-documented economy is also flourishing along with documented economy. According to some insiders, the volume of undocumented economy is more than the documented one and it is flourishing with unrealistic steps taken by the FBR. He said that prudent and widely acceptable steps are required to transfer undocumented into documented economy. It will not only increase our tax to GDP ratio but also help government to almost double its revenue collection.
However, it will be a Herculean task and government has to take bold steps against the influential circles that are henceforth enjoying tax exemptions.
Rizwan added the government has to introduce even taxation system by eliminating all exemptions across the board.