Lahore Chamber of Commerce and Industry (LCCI) in collaboration with Collectorate of Sales Tax and Central Excise Lahore arranged a marathon three-hour long session with manufacturers, importers and other businessmen to discuss the implementation of post budget measures relating to Sales Tax Act 1990.
Main topic throughout the session remained withdrawal of 'carry forward' scheme and businessmen were apprised by the officials including Member Sales Tax of the new system introduced under SRO 666 (1) 2005.
Additional Collector Asim Majeed gave a presentation on the SRO and its salient features, and changes in Central Excise and other relevant information.
While addressing the seminar, Central Board of Revenue (CBR) Member Sales Tax Shahid Ahmed said the department was developing software to process the cases of Sales Tax filed under SRO 666 (I) 2005. He hoped the software would be in use by the department by October this year.
He said that abolishing the 'carry forward' regime was the decision of the government, he said and added that that facility had actually been given to ginned cotton, as they used to make purchases in three or four months and consume their goods through out the year.
As, now, ginned cotton had been excluded from the Sales Tax regime, so there was no justification to continue this scheme. Secondly, he said in some cases, department had no system to verify that input tax filed by the taxpayer was admissible or not, he added. He claimed that value added tax (VAT) system was applicable in 136 countries around the world and majority of those did not have carry forward scheme.
He made it clear that manufacturers could claim 'carry forward' for three months. As commercial importers declare 10 per cent value addition at the time of import and pay tax on it, so there was no need for them to be perturbed. He asked the Collector Sales Tax Lahore to arrange a meeting with the Commercial Importers to remove misunderstanding about the new SRO. He said that some sort of system would also be devised for the wholesalers and distributors except those falling in third schedule.
Collector Sales Tax Lahore Nazim Saleem said they were fully cognisant of hardships being faced by the businesses. He added the Member Sales Tax were focusing on that scheme and wanted that it should not fail.
Earlier, the LCCI President Mian Misbah ur Rehman urged the Member Sales Tax to withdraw SRO 525(I) 2005 immediately, as it would multiply the taxpayers' problems due to low compliance level and lack of sufficient administrative capacity of the Sales Tax Collectorate.
He also invited the attention of the Member Sales Tax towards conditional Carry Forward facility to manufacturers saying that while allowing facility, the CBR has once again ignored the commercial importers and other segments of business. The CBR should withdraw SRO 666(I) 2005 immediately as it was impractical and the provisions of previous system of carry forward of excess input tax should be restored.
He said the inputs of export oriented industries ie textiles, carpets, surgical, sports and leather goods have declared zero rated for which the industry was very thankful to the CBR. Another important issue relates to black-listing of any person suspected for evasion of tax, yet it was felt that there was no justification for harassing the taxpayers who had purchased goods from such suppliers especially when the supplier was black-listed after lapse of considerable time period.
The innocent buyers making purchases from the tax evaders could not be penalised on assumptions alone. At present, the innocent buyers were unnecessarily harassed and subjected to flimsy audit observations, he added.
LCCI Senior Vice President Sohail Lashari, Vice President Sheikh Mohammad Arshad, former LCCI Presidents Iftikhar Ali Malik, Sheikh Mohammad Asif and Mian Anjum Nisar also spoke on this occasion.
Comments
Comments are closed.