LAHORE: The province of Punjab is leading other provinces in offering tax relief measures in its Finance Bill to revive the Coronavirus-hit economy.

Interestingly, the Federal Board of Revenue (FBR) has also not offered any relief in terms of rate reduction, thus remained unresponsive to the need of the hour. Even, it has not offered any rate reduction in ICT on sales tax on services.

A comparative study of the finance bills of all the four provinces carried out by a leading tax expert Muhammad Javed suggests that Balochistan is the next province that has followed Punjab in offering tax relief measures. As a matter of fact, it has almost copied the tax measures of the Punjab government.

The Punjab government has announced a reduction in tax rates ranging from 5 to zero % in almost 23 sectors. It has also waived the penalty for late payments of property tax and stamp duty on transfer of property from 5 to 1%. In order to get an automatic stay in case of first appeal deposit of 25% of tax is reduced to 10% and the time limit of filing of appeal to the tribunal has been enhanced from 30 days to 60 days.

Similarly, in order to minimize the face to face interaction, the Punjab government has introduced e-Audit scheme and e-Appeal filing besides e-Invoicing in business sectors on a B2B basis. This is a unique initiative of the Punjab government for ease of doing business and digitalization of the provincial revenue authority. Besides, in restaurant and beauty parlour sectors a rate of 5% has been offered if the payment is made through Debit/Credit card. This will usher in a new era of documentation of the economy. The feel of the Punjab budget is its flavour of economic revival from a 'tax economy' point of view. It is futuristic and well thought out and shows how the government, especially the PRA is responsive to business needs.

So far as the province of Sindh is concerned, it has neither brought out any Finance Bill this year nor has it offered any relief. KP Finance Minister Taimoor Saleem Jhagra has restricted himself to offer massive relief through a notification to be issued later. The province has offered a waiver of penalty up to 35% for property tax defaulters besides giving an option of payment in 12 equal instalments. The Khyber Pakhtunkhwa government has announced that the local government department would abolish taxes on 200 Small and Medium Enterprises (SMEs), followed by the excise and taxation department. So far as the abolition of 18 professional taxes is concerned, it has been subjected to the registration with the provincial revenue authority.

Copyright Business Recorder, 2020