Founders Group at the Lahore Chamber of Commerce and Industry has demanded of the government to withdraw withholding tax on bank transactions as it is not only jacking up the cost of doing business but also promoting trust deficit between the government and the business community. While speaking at a meeting on Tuesday, the Group's leaders including Mian Muhammad Ashraf, Sheikh Muhammad Asif, Farooq Iftikhar, Khawaja Khawar Rasheed and Zeshan Khalil said that business community was expecting that withholding tax on bank transactions would be eliminated but no such announcement was made.
They said that withholding tax is being collected forcefully without keeping in view the challenges being face by the business community.
Imposition of withholding tax on banking transactions was a bad decision, they said and added that the business community was already paying income tax, sales tax and various other duties and taxes imposed by the federal and provincial governments. They said that withholding tax on banking transactions is doing more harm than good and continuously affecting the business atmosphere in the country.
They said that business community has rejected withholding tax on banking transactions from the first day but authorities concerned are not ready to realize the ground realities. They said that though expansion of tax net is need of the hour but the government would have to find out new ways to bring the untaxed sectors into the tax net. Measures like imposition of withholding tax on bank transactions are not doing any service to the economy as it has been observed that tax collection machinery has no authentic data to specify difference between filers and non-filers, they added.
Founders Group leaders said that tax on all bank transactions is not only hampering the trade and economic activities but is also tarnishing the soft image of the government. The levy of this tax has forced business community to conduct its monetary transactions in cash that is promoting undocumented economy, they said and hoped that withholding tax on banking transactions would be withdrawn immediately in the larger interest of the industry, trade and economy.
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