ISLAMABAD, MAY 30 (DNA) – The government is adding up tensions for registered businesses, as all the legal formalities are only for those who are in the tax net and who are more documented.
This was stated by Friends of Economic Business Reforms President Kashif Anwar in his budget proposals for 2021-22 sent to the finance ministry and the FBR.
“We appreciate your measures to document the economy thereby enabling the present government to achieve a milestone of enhancing the tax base but more efforts are needed to facilitate the taxpayers and documented sectors,” he added.
Calling for reducing the rate of fines, penalties and surcharges, he said that people outside tax net are very happy since all the legal practices, laws and SRO’s are for those who are already in tax net. A registered person has to deal with several departments like Sales Tax, Income Tax, EOAB, Social Security, Education Cess and Labor etc.
Kashif Anwar said that powers of taxpayers should be increased with the powers of tax collectors while action should be taken against those assessing officers whose assessments are reverted back by higher courts and tribunal.
He suggested that Income Tax Registered retailers, who are not required to get themselves registered in Sales Tax should be considered registered when manufactures issue them Sales Tax invoice to lessen the burden of 3% additional Sales Tax on manufacturers.
As additional Sales Tax and Income withholding is the cost which manufacturers have to bear. Manufacturers have to pay additional 3% S/Tax on supplies made to Income Tax registered persons.
Kashif Anwar said that rate of withholding taxes should be minimized for documentation and not for collection of revenue, as frequent amendments, daily SRO’s, Notifications and Circulars have confused the registered persons while the number of withholding taxes and rate of taxes are increasing day by day.
He said that rate of advance income tax should not be more than 0.5% for documentation and not for collection of revenue while 100% benefit of Sales Tax paid should be given to Sales Tax registered persons.
He also suggested to impose regulatory Duty, Customs Duty and Additional Customs Duty on Raw Materials which are produced locally in Pakistan while CD & RD should not be imposed on those raw materials which are not produced locally.
He demanded harmonization between Federal Board of Revenue and Punjab Revenue Authority with a view for simplification of tax returns, reducing burden of filing extra returns from the taxpayers.
Currently, in order to claim the input tax of services rendered in other provinces, an individual or company has to get themselves registered with revenue authority in that province to claim the input. Otherwise, they have to forgo the tax which is a financial burden for that business,” he said.
Currently Corporate Tax Rate for companies is 29% which due to Workers Welfare Fund (WWF) and Worker Welfare Participation Fund (WWPF) goes up to 36%. It should be reduced to 20% and continue to decrease gradually in coming years.=DNA
=========
 - The government is adding up tensions for registered businesses, as all the legal formalities are only for thos){kind=link}