Traders call strike today against withholding tax

KARACHI: Traders have called a countrywide shutter-down strike on Wednesday (today) against the imposition of withholding tax on a banking transaction of over Rs50,000 for non-filers of returns.
The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) and Karachi Chamber of Commerce and Industry (KCCI) disassociated themselves from the protest against the tax.
Chairman All Karachi Tajir Ittehad (AKTI) Atiq Mir on Tuesday said trade community rejected the withholding tax.
“The protest is part of the rejection to demand the government of withdrawing the illegal levy,” Mir said.
He said AKTI is supporting the protest under the umbrella of All Pakistan Tajir Ittehad.
Some trade bodies observed strike on August 1 to protest against the tax, resulting in closure of the major markets across the country.
Mir said the port city of Karachi contributes around 68 percent of the total revenue at the national level.
“We have no other option but to protest as the government is not serious in resolving the issues of trade community,” he said.
He added that the trade community will not even accept the reduced rate of 0.1 percent. “Our sole demand is withdrawal.”
The federal government, in the budget 2015/16, introduced 0.6 percent withholding tax on non-filers to be deducted on all the banking instruments above Rs50,000.
However, after the businessmen’s rant the government brought down the tax rate to 0.3 percent through issuing a presidential order on July 11. The tax is valid till September 30.
Mir said those who agreed with the reduced rate were not the real representation of the trade community.
KCCI said the issue is genuine but the protest is not a solution.
“We believe in discussions to resolve the issue,” said Iftikhar Vohra, president of KCCI.
Vohra said the chamber has not called for any protest demonstration for the past 15 years.
He said dialogue is the only solution and therefore the chamber officials are frequently attending meetings in Islamabad to resolve the issue.
The apex trade body FPCCI is also part of the consultations with the government on the withholding tax issue.
FPCCI president, in a statement, demanded the government of the tax withdrawal.
The statement said the Federal Board of Revenue should evolve a mechanism to update the income tax return filers to prevent the tax collection from those who have filed returns.