The Karachi Chamber of Commerce and Industry (KCCI) has suggested that Central Excise Duty (CED) on import of raw materials and affected local industries, manufacturing beverages, transformer oil, shampoos, creams, powders, cosmetics and toiletries etc, should be abolished and only sales tax be retained in the coming budget.
In a communication to the Federal Board of Revenue (FBR), KCCI President Shamim Ahmed Shamsi noted that imposition of both sales tax and excise duty on local manufacturing units and imports, constituted double taxation and contrary to the policy of phasing out the CED. Multiplicity of taxes, involvement of a larger number of officials, inspectors and auditors led not only to corruption, but also causes harassment, thus affected business environment. He also expressed concern over delay in action by the FBR on the applications made for sales tax registration and de-registration.
He regretted that delay in timely action by the FBR on application made for sales tax registration, which caused difficulties in normal business activities. Similarly, requests made for de-registration were not acceded to/ responded within the stipulated period, he added.
On the other hand, the registered persons, who had never applied for de-registration, were de-registered by the FBR on suo-moto basis, which might lead to misuse of powers by those involved in sales tax registration.
He said that amendments made in SRO, empowering the intelligence and investigation officials of the Directorate General of Intelligence and Investigation with the additional discriminatory powers be withdrawn. Shamim Shamsi noted that various officials of the Directorate General of Intelligence and Investigation, in addition to their power of adjudication and file reference in the high courts etc vide SRO 48(1)2008 of January 15, had also been empowered to access and search the business premises, stocks, accounts and records of registered persons, issue summons and or arrest them.
Besides, senior officials - the director general, director, additional director, deputy director etc - junior officers like deputy superintendent, auditor, appraiser, valuation officers had also been empowered access to records, documents etc U/s 25, drawing of samples U/s 25A, summon persons U/s 37 and to have access to their business premises, stocks, accounts and records U/s 38 of the Sales Tax Act, 1999. He said empowering junior officials might lead to misuse of discretionary powers of harassing the taxpayers for their ulterior motives.
He said this was against the government policy of curtailing discretionary powers of tax officials and minimising the direct contact between a taxpayer and a tax official as it led to corruption and tax evasion.