The Federal Board of Revenue has requested the business community not to seek tax exemptions, concessions or zero-rating facility in the upcoming budget (2012-13). The FBR on Thursday issued policy guidelines to the business community for preparation of budget proposals (2012-13) with top priority to abolition of outdated provisions of tax laws, simplification of tax procedures, expanding tax net and controlling tax frauds and fiscal crimes.
The FBR has issued sales tax and federal excise instructions to 23 chambers, federations, tax bar associations, trade bodies, business groups, retailers associations, stock exchanges and other leading representatives of business community like Pakistan Business Council and Overseas Investors Chamber of Commerce and Industry.
According to sources, the FBR has requested the business community not to ask for tax exemptions, concessions and zero-rating facility in the coming budget (2012-13). This is for the first time that the FBR has specifically requested the business and trade to avoid budget proposals on tax exemptions and zero-ratings etc.
On the other hand, the budget proposals should focus on measures and changes in existing procedures to control tax frauds and loopholes, causing revenue loss to the exchequer. The FBR has asked the business and trade to chalk out budget proposals taking into account the following broad parameters:
Firstly, amendments may be suggested in the Sales Tax Act 1990 and Federal Excise Act 2005, sales tax/federal excise rules and procedures with a view to achieve simplifications and to abolish the outdated/obsolete provisions of the tax laws.
Secondly, the budgetary proposals may be revenue-oriented during next fiscal. Thirdly, the budget proposals may focus on broadening the tax base instead of suggesting further exemptions/zero-ratings.
Fourthly, preferably budget proposals should aim to achieve simplification of procedures (wherever possible a draft procedure may be submitted to the FBR).
Fifthly, the proposals should be made keeping in view the consequences of other related trade groups which might be adversely affected by the proposed measures.
Sixthly, the FBR would specially welcome the proposals for plugging tax frauds, loopholes if any, facilitating the taxpayers and making the procedures transparent. Seventh, the FBR has requested that the requisite proposals may be sent to the Board by March 15, 2012.