Income Tax Ordinance 2001: section 140 creating mistrust between banks, businessmen: LCCI

The Lahore Chamber of Commerce and Industry (LCCI) has said that Section 140 of Income Tax Ordinance 2001 is creating mistrust between the banks and the business community, therefore, it should be withdrawn immediately. The Lahore Chamber of Commerce and Industry (LCCI) President Ijaz A Mumtaz in a statement said that giving powers to the FBR officials to attach/freeze bank accounts of business entities, while cases are pending in appeals, would create an environment of mutual mistrust among the business fraternity and the commercial banks.
"The FBR move would not only give a negative message to the local investors but would also discourage the much needed foreign investment," he added. He said that attaching/freezing of bank accounts of business entities would also bring additional hardship for the businessmen who are already battling for survival in the presence of energy crisis and high input cost of doing business.
He urged the Federal Finance Minister Ishaq Dar to immediately stop the FBR from this practice that is pushing the tax payers to the wall besides denting the reputation of a business-friendly government. The LCCI president further said that the FBR should focus on controlling under-invoicing and curbing the menace of smuggling besides expanding tax net but it is playing arm-twisting by instituting cases for recovery of outstanding dues and attaching bank accounts.
He said that it is unfortunate that the FBR is creating troubles for the businessmen for the recovery of its outstanding dues just to meet the revenue targets and for the sake of show of performance. According to FBR's own documents, the total amount of refund in the year 2013-14 has reached the staggering amount of 104 billion rupees which is 16.4 percent higher than the previous year figure of 93.6 billion rupees.
He said that almost 36,000 refund cases are pending with the FBR. There are companies which could not get cleared their refund cases even after the lapse of 14 years. The LCCI chief said that there should be a level-playing field in this regard. He said that if a tax defaulter is liable to penalties and attachment of bank accounts, the same should apply to FBR functionaries if they fail to release the valid refunds of the businessmen. Accountability in this regard would force the FBR officials to expedite the payment of refunds, he mentioned.