The Federal Board of Revenue (FBR) notices to the beneficiaries of amnesty scheme and also to the non-filers paying withholding tax against their transactions has slowed down the business activity in major cities of the province, said business community sources. They said notices have been received by the beneficiaries of amnesty scheme despite the fact that they have declared their assets after paying a fixed tax against it. It has panicked them by and large and they are seeking advice to deal with the situation.
The sources added that a good number of unregistered buyers, particularly those operating in the yarn market of Faisalabad, are also receiving notices and they have stopped their business transactions to protect their undeclared money.
It is generally believed that this single step on the part of FBR has resulted into a stalemate situation in the market. Critics of the FBR believe that these notices are uncalled for as no one can question the assets declared under the amnesty scheme. Also, they added, the effort of brining unregistered buyers to the tax net would meet the fate equal to that of the Musharraf regime that had failed miserably in registering the trading community. These circles also pointed out that the FBR notices are a negation of Prime Minister Imran Khan's clear commitment to let people make money in the system.
They said issuance of notices to the beneficiaries of amnesty scheme and unregistered buyers availing withholding tax regime is a conspiracy against the government. However, the FBR sources have made clear that notices have been issued to those beneficiaries of amnesty scheme whose assets have been found out by the FBR after declaration of assets under the scheme.
They said the FBR was asking them only about the status of those assets which have neither been declared in the scheme nor declared in the annual tax return. So far as the non-filers are concerned, they said, they are being treated under the withholding tax regime. It may be noted that the FBR is facing a shortfall of Rs 175 billion during the first six months of the current fiscal.
Efforts are underway to meet this shortfall in the remaining half of the current fiscal year. Sources are doubtful about the FBR ability to meet the revenue shortfall. However, they believe that the government is set to announce a mini budget of about Rs 175 billion by raising the rate of withholding tax and regulatory duty in a week or so. But still meeting the revenue target would be a challenge for the FBR, they commented.