A proposal of traders' community is under examination to reduce the rate of withholding tax on banking transactions of non-filers to 0.2 percent with enhancement in the threshold from Rs 50,000 to Rs 100,000 till December 31, 2015 and any final decision would be announced in next round of talks to be held on Wednesday (October 14).
Sources told Business Recorder here on Friday that the government side convened meeting with one traders group ie All Pakistan Anjuman-e-Tajran (Mian Manan Group). The second group of All Pakistan Anjuman-e-Tajran(Khalid Pervez Group) left the FBR House without reaching any consensus. Therefore, the talks between the government and traders on withholding tax on banking transactions of non-filers remained inconclusive.
A senior government official said that traders demanded drastic reduction in WHT rate to 0.1 percent and increase in threshold from Rs 50,000 to Rs 3 lakhs. However, there is also demand of 0.2 percent WHT and enhancement in the threshold from Rs 50,000 to Rs 100,000. But it is premature to say that the government has accepted this demand of 0.2 percent WHT and enhancement in the threshold from Rs 50,000 to Rs 100,000. These are demands and nothing has been final in this regard, he said.
Official said that the committees constituted in August were revived again to review the demands of the traders' community. Tax authorities will consider those demands of traders which are legally possible. So far, nothing has been finalised on the tax incentive package or amnesty scheme for the traders. We will discuss all issues in next meeting and all traders' group presence can make that meeting successful, he added.
Finance Minister Ishaq Dar, who headed government side, stated that significant progress was made on the issue of withholding tax with one group of the traders, and will resume the next round on Wednesday. Dar categorically conveyed to the traders that the levy cannot be withdrawn altogether at the conclusion of the two days talks. Finance Minister further said that the traders have supported withholding tax on banking transactions of non-filers and final round of talks would be held next Wednesday.
On the conclusion of meeting between government and traders group of All Pakistan Anjuman-e-Tajran at FBR House on Friday, Finance Minister said that the government is serious in resolving issue of withholding tax on banking transactions of non-filers. Both the sides have made progress on the issue of documentation of traders and payment of withholding tax. The government will facilitate traders by improving the tax collection system, Dar added.
A FBR official said that we will decide the issue in the next meeting. Significant progress has been made with one the traders group, who still willing to resolve the issue through negotiations. The talks remain unsolved because one group headed by Khalid Pervez left the talks in the middle. We will resume talks on Wednesday when all groups are part of the negotiation. Until all traders groups come to negotiations terms, the talks cannot reach to any conclusion, he added.
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