The Chairman of Pakistan Cotton Ginners Association (PCGA) Chaudhry, Masood A Majeed, has said that the Federal Board of Revenue has issued a circular, No 10 (income tax 2011) in which all demands raised by the ginners were accepted besides withdrawal of SRO-787 dated August 22,2011.
Addressing a thanksgiving press conference here on Monday along with Vice chairman Shehzad Ali Khan and senior ginners Muhammad Saeed, Muhammad Iqbal, Wahgeed Akhtar, Aasim Saeed, Umair Ali Khan and Riaz Hussain Siddiqui, Masood said that circular No 787 was issued following the talk between the representatives of PCGA and FBR on August 22, but it was ambigious and misleading, causing creation of new issues for ginners. However, fresh circular has ended all ambiguities, lacunas.
He said that farmers would not be binding to submit/present any proprietary document to ginners at the time of selling their produce. They would only supply photo-copy of their national identity card besides informing their total production to the ginners. Farmers would be exempted from 3.5 pc withholding tax and this tax would not be deducted from them at any stage. However, those farmers who would sell their produce through a commission agent/arhti/middleman/broker, then 1/10 of the commission would be deducted.
PCGA chairman said that now commission agents would come in tax net with these measures taken by the Government. He said that 99 percent sale of cotton is carried through the commission agents and government would earn handsome revenue from the cotton business. However, its Paragraph 3 shows that farmers would be exempted of WHT as usual and this tax would be deducted from the middlemen/arhtis/brokers. Commission agents, arhtis and beoparis would be liable to pay ten percent of their commission in national treasury. However, cotton ginners would be responsible for keeping the record of Farmers and commission agents only for the perod of one season/one year. They would be responsible in case of any fake, ingenuine and wrong documents. FBR officials would scrutinise and check the documents supplied by the ginners.
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