The Progressive Group in the Lahore Chamber of Commerce and Industry has urged the Finance Ministry and the Federal Board of Revenue to look into banks deducting 0.3 percent withholding tax from tax filers despite repeated orders by the government and the board.
In a statement issued on Friday, group President Khalid Usman and Deputy Secretary Muhammad Ejaz Tanveer claimed on Friday that they are receiving complaints from traders that the banks are even deducting the tax from filers. "Traders and businessmen becoming subject to this injustice are those who have NTN number in their name but not against their company and are regular filing their income tax return mentioning all their income," they claimed.
They said the banks are advising protesting traders that they should apply for refunds at the end of the financial year. "However, everybody in Pakistan knows the fact that it is almost next to impossible to get refunds from the board. Stuck-up refunds also create a liquidity problem for businessmen, especially small businessmen," they added. Both leaders said nobody is against paying the taxes but the board, instead of relying on indirect taxes, should broaden the tax net. Constitution of committees by the board in the name of facilitating the traders will not work, they mentioned.
"The government should pay attention to the real cause of concern. This kind of indirect tax will have a multiplied impact on the transactions. It is hampering the banking transactions and using formal money transactions channels," they said. They also said this tax would discourage the use of banking channels and hamper the business of largest service sector, for instance, the banking sector, thus leading to loss of revenue to the national exchequer being collected on banking services.
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