Pakistan Industrial and Traders Association Front (PIAF) has urged the government to announce tax free budget for the year 2016-17 to achieve high economic growth; as increase in number of taxes always discourage people to stay out of the tax net while cut in tax rates always expand the tax base. The PIAF chairman Irfan Iqbal Sheikh raised this demand while leading a delegation of various markets traders that met with the President, Lahore Chamber of Commerce and Industry (LCCI) Sheikh Muhammad Arshad here on Tuesday.
He also called for simplification of taxation system and said a simplified and friendly taxation system would encourage businessmen to come into the tax net. "Our government should rationalise tax tariffs instead of making any increase in their rates," he added.
Speaking on the occasion, Sheikh Muhammad Arshad said the economy cannot grow amid major issues including double taxation and undue delay in refund claims, therefore, the government must resolve such issues as soon as possible. He urged the Federal Board of Revenue (FBR) to pay attention towards issue of double taxation which has become a major hurdle in the running of smooth businesses. After the 18th Amendment, provinces have developed their own legislations and rules for the administration of sales tax on services.
He also urged the FBR to expedite releasing the stuck-up sales tax and income refund claims that is creating liquidity crunch for the industry. The FBR is hampering the growth of the most productive sectors by denying the exporters and manufacturers their right of refund of Sales Tax and Income Tax, he added. He said that the delay in release of huge funds that runs into billions has triggered serious liquidity crunch for the exporters and manufacturers that might lead to closure of several industrial units.
The process of getting refunds is so lengthy and cumbersome that sometimes takes months for a manufacturer or exporters. The FBR Chairman should look into the matter and ensure early release of Sales Tax and Income Tax refunds, he said. The LCCI Chief urged the federal and Punjab governments to reduce the undue interference of government departments in the business activities to ensure business friendly atmosphere. It would not only encourage the local investors and help trust building between the businessmen and government departments but would also air a good message to the foreigners, he said.