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September 18, 2020

FBR lays ground for industry-friendly tax reforms


September 18, 2020

KARACHI: The Federal Board of Revenue (FBR) has formed high-powered committees to create an enabling environment for the promotion of manufacturing and industrialisation in the country by simplifying the taxation system, officials said on Thursday.

Dr Abdul Hafeez Shaikh, Advisor to the Prime Minister on Finance and Revenue has approved the bodies that included a technical committee and a complaint oversight committee.

The technical committee is headed by Abid Shaban, a reputable tax consultant and member of the Tax Reform Commission (TRC), formed by the government in the past.

The officials said the government was serious in simplifying tax laws and reducing burden on the business community, adding that besides, the purpose of forming such committees was to ensure ease of doing business.

The technical committee was headed by a tax expert, while its members comprised representatives of businesses and FBR officials, the officials said.

However, they added that the chairman of the committee should be allowed to induct more technical experts for preparation of proposals for amendment in tax laws.

According to the Terms of Reference (TORs), the committee is to identify distortion, anomalies, and inequalities in the taxation system that cause difficulties for taxpayers, discouraging investment, industrialisation, and documentation, while the body will also propose solutions in the light of its findings.

Further, the committee shall also propose measures to reduce the dependence on withholding taxes, minimum tax, advance tax, etc.

Besides, the committee has been given the task to propose measures for simplification of all taxation procedures, in a manner which does not compromise revenue collection and documentation.

The committee shall also consider and propose improvements in the temporary importation and manufacturing bond schemes to enhance their scope and facilitate direct and indirect exporters throughout the value chain.

Other TORs on which the committee would work included identifying issues hindering smooth processing of refund claims through the FASTER system.

It shall propose amendments in the procedure or thresholds relating to sales tax refund of various sub-sectors of exporters.

Mussadaq Zulqarnain has been nominated as chairman of the other committee, which has been constituted to oversee and monitor the complaint resolution mechanism of the FBR.

As per the TORs, this committee has been tasked to maintain complete and holistic oversight over the complaint resolution mechanism of the FBR and review the entire lifecycle of a given complaint from its lodging, nature, action taken, resolution, post-resolution review, to further action required to be taken.