PCGA for immediate withdrawal of WHT

Pakistan Cotton Ginners Association (PCGA) urged upon the government to immediately withdraw the imposition of 0.6 percent withholding tax (WHT) on all banking transactions for non-filers, as it would discourage banking transactions, promote non-banking and cash transactions and would lead to harmful consequences for the economy.
Acting Chairman of PCGA Ramesh Lakl, Vice Chairman Punjab Rao Sadruddin, Ginner group's chairman Haji Muhammad Akram, Shehzad Ali Khan, Ex-Chairman Sheikh Muhammad Saeed, Haji Muhammad Ibrahim ,Suhail Ahmed Haral, Mian Mehmood Ahmed, Amanullah Qureshi, Mukhtar Ahmed Baloch, Mahesh Kumar, Rana Abdul Sattar and other members of Central Executive committee said the government has imposed advance adjustable income tax at 0.6 percent on all banking transactions of over Rs 50,000 in a day for non-filers in a bid to compel them to become filers. However, They apprehended that this decision would lead to many complications in the economy as it would cause a drop in bank deposits, promote the culture of cash transactions, affect the profit margins of taxpaying businessmen and enhance turnover tax for the filers.
PCGA leaders said the increased reliance of the government on WHT could become counter-productive, as it would further give incentives to non-filers to conduct cash transactions and promote informal economy in the country. They said the imposition of this tax would also give rise to inflation, as the non-filers would pass its burden to the common man who would pay high prices on purchases. They said that almost the whole business community of the country strongly opposed this new tax and the government should seriously consider its urgent withdrawal to avoid any disturbance to the business and economic activities. They said the levy of 0.6 percent WHT on non-filers would also affect the objective of financial inclusion. They said the government was already charging 0.3 percent withholding tax from banks on the transactions of Rs 50,000 and now the imposition of 0.6 percent tax on non-filers would push many businessmen towards the informal economy. They termed it unfortunate that the government did not take business community on board before imposition of this new tax and stressed that it should shun the practice of taking unilateral decisions.