Tarin decides to hold meetings with trade bodies after briefings from ministry

ISLAMABAD: Minister for Finance and Revenue Shaukat Tarin said to have decided to hold meetings with the business and trade bodies including the Federation of Pakistan Chamber of Commerce and Industry (FPCCI) after getting briefings from various wings of the Finance Ministry.

An official said that a meeting with the representatives of the business community was expected on Wednesday; however, it was postponed because the Finance Ministry wanted to be updated by the various wings of the Finance Division.

Tarin, according to sources, has taken briefing from various sections of the ministry for better understanding of the actual situation.

The official further stated that as soon as the finance minister completes briefings, he would start holding meetings with the business community and would also interact with the media.

Sources said that on Wednesday, the Finance Ministry meeting with the governor State Bank of Pakistan lasted quite some time, and later on, Adviser to Prime Minister on Institutional Reforms Dr Ishrat Hussain also met with the finance minister.

Sources said that the Finance Ministry also held a separate meeting on growth with the Chairman FBR and other senior government officials at the Ministry of Finance.

An official, on condition of anonymity, said that Special Assistant to Prime Minister on Revenue Dr Waqar Masood spent most of the time with Shaukat Tarin.

Sources in the FBR said that Chairman FBR Asim Ahmad also went to the Ministry of Finance on Wednesday to participate in these meetings with the representatives of the business community, but the meeting was postponed.

When contacted, one senior representative of the FPCCI told Business Recorder that the federation would not held meetings with the Ministry of Finance or the FBR on budget proposals (20201-22) till the tax authorities respond to the letters/communications of the FPCCI.

“If the FBR is not ready to respond to the letters of the FPCCI, there is no justification to hold budget meetings with concerned authorities. The FBR seems to be not serious to respond to the letter on “simplification of taxes”. Thus, there is no need to discuss budget proposals with them till they are serious about the communications of the FPCCI,” he said.

“This year the FBR has to give rationale behind accepting or rejecting each budget proposal of the FPCCI. The budget markers cannot simply throw away the proposals, but they have to justify each proposal,” he said.

In this regard, the FPCCI is still waiting for implementation of instructions issued by the prime minister on March 3, 2021 to all the concerned ministers.

The FPCCI had written a letter to the prime minister for simplified taxation and accelerated economic growth, in which the president FPCCI suggested a simple, fair, and predictable tax system: 10 percent income tax 20 percent income tax for companies, 5 percent sales tax (for exporters 0 percent tax (one chapter, one rate, 5 percent) on all items and federal excise duty health-hazard products like cigarettes, beverages etc.

After receiving the letter, Secretary to Prime Minister, Azam Khan sent a directive of the Prime Minister to Minister for Finance, Minister for Industries and Production, Advisor to Prime Minister on Commerce and Investment, Special Assistant to the Prime Minister on Revenue, Chairman FBR, and Shaukat Tarin, to hold meeting with the FPCCI and finalise taxation reforms/changes in the light of the Association’s letter.

The chairman FBR was directed to make a presentation, whereas Secretary Finance was asked to coordinate the meetings.

The final decision/options in this regard were to be presented to the prime minister within 10 days.

So far, none of the concerned departments have implemented the said instructions issued almost one month ago.

FPCCI President Mian Nasir Hayat Magoo has already taken up the issue of issuance of show-cause notices with Dr Waqar Masood Khan, the SAPM on Revenue.

In a letter to the SAPM, Maggo said that the retail outlets as per conditions in Section 43A were required to integrate their outlets by 31-08-2020 with the FBR’s computerised system for real time reporting of sales in the mode and manner prescribed in chapter XIV-AA of the Sales Tax Rules, 2006.

The section 43A has provided categories which are required to be registered under Tier-1 retailer of sales tax Act.

However, businesses which are not required to be registered in terms of section 43A, in specific small businesses and SMEs are being issued show cause notices by the FBR officials, which are being duplicated by intelligence, investigation and prosecution cell to harass the small and SME businesses in Covid-19.

The FPCCI president further said that we are in the favour of broadening of the tax base but equally we are advocating the need of lawful application of tax statutes, wherein, the violations by the FBR are in absolute terms being undisputed.

The accountability in issuing such non tenable show-cause notices also is absent in actions and the present rules of business.

Magoo told the SAPM on Revenue that business must be conducted in harmony not amid conflict and contradiction created by self-interpretation of sections of the tax statutes by tax functionaries, hence the request for extension up to June 30, 2021 for registration with fair assessment as which business entities would fall in the conditions of section 43A, which presently is being misused.

Copyright Business Recorder, 2021