PESHAWAR: Sarhad Chamber of Commerce & Industry, Peshawar for extending certain incentives to existing tax payers have filed their tax returns for at least last three years or more without apparently attracting any unlawful declaration or warranting inquiries and audit.
The demand has been made in the Sarhad chamber’s recommendations for the federal budget 2021-22. Such incentives should be offered by extending special discounts, saying equivalent to 50 percent, in respect of payment of fee and taxes for the taxpayer and his spouse in passport issuance/renewal, driving license/ renewal, waiver on loan processing fee, rebate in electricity/ other utilities and banking services fee.
The recommendations said there is a need to rebuild relations of the taxpayers and the tax collectors, the way it can be seen in the European countries, where also the concept of tax avoidance and tax evasion equally exists. But, the way government(s) have reposed confidence in the citizens and the facilities provided accordingly, that if taken into consideration in Pakistan would definitely result in widening tax base and tax collection with eventual rise in the tax to GDP ratio.
It said that foreign investors have also suggested the Federal Board of Revenue (FBR) to develop a five years’ roadmap for enhancement of revenue collection by reviewing exemptions allowed if any, concessions and amnesty schemes besides bringing agriculture income into the tax net.
Similarly, the Overseas Investors Chambers of Commerce and Industry (OICCI) had also strongly recommended that the tax reforms must be an ongoing process while the policies should change only to adjust to the changing economic structures.
The chamber has strongly recommended utilization of data available with the National Database Registration Authority (NADRA) in order to identify potential taxpayers besides taking other equally important initiatives.
It has recommended the allowing of some incentives to the compliant taxpayers in shape of reduce rate of minimum tax or a lump sum rebate on overall tax liability as the case may be, if they declare their respective turnover by furnishing details of CNIC/NTN of their respective customers to help data compilers for the increase in tax base.
The recommendations added that the current taxation policy doesn’t attract the existing taxpayers from the point of view of following any incentive to promote tax culture. The FBR should allow some good percentage (15 to 20 percent) out of the amounts withheld by the taxpayers as obligatory on them as withholding agent. No agent in the world will ever work free of remuneration and it is very much obvious that the withholding agent is constantly incurring huge cost of services to monitor an invariable deductions of tax, payment onward to the FBR within the stipulated time period and above all, maintain a proper and systematic record by filing requisite periodical returns etc, for sure involve extra-ordinary efforts and cost of services.
So, it said, the compliant taxpayers are thus, very much entitled for encouragement and a compensation in the shape of retaining some good percentage (15 to 20 percent) on monthly basis.
The chamber said that the recommended incentives would not only promote and rebuild friendly-relations between and amongst FBR and withholding agents, particularly from corporate sector, rather would also enhance and accelerate the quantum of withholding taxes compared to the level of amounts deducted at source previously.
The amount would be recovered by the withholding agents without additional impact to be passed on towards FBR.
Copyright Business Recorder, 2021
Comments
Comments are closed.