The Federal Board of Revenue (FBR) has out rightly rejected a proposal of cotton ginners to drastically reduced withholding tax from 3.5% to 0.1%, despite all kinds of pressures including strikes by this sector. Sources told Business Recorder here on Monday that the FBR and cotton ginners held a meeting here at the FBR House to discuss proposal to either abolish 3.5% withholding tax or reduced the rate to a minimum of 0.1%.
Tax authorities have rejected the proposal on the argument that such a major decrease or withdrawal of withholding tax would discourage documentation of the entire chain including growers and ginning industries. Despite sever pressures of on going strikes, the FBR took bold stance space and only accepted viable proposals of the cotton ginners.
In this connection, the FBR is expected to issue a notification here on Tuesday (today) to facilitate the cotton ginners. The notification has been bettered by the Law and Justice Division which would be issued on Tuesday (today). However, the FBR has not accepted any unrealistic proposal of the concerned association which would be against the government, drive of documentation.