AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
Karachi, March 20, 2013 (PPI-OT): The Business Community of Karachi has deep concern over the recent controversial SROs issued unilaterally by the Federal Board of Revenue keeping the genuine stakeholders (Chambers/All Pakistan Associations) in isolation and taking on board only few non-representatives with whom they FBR officials meet at their homes at luncheon meetings and make decisions.
The Business Community has rejected the controversial SROs Nos. 212(I)/2013, SRO 154(I)/2013 and SRO 98(I)/2013 in toto and strongly believe that the FBR may have some ulterior motives behind such anti-business move which like in the past will increase fraudulent business practices providing an opportunity to the unscrupulous elements to enjoy edge over the genuine businesspersons. FBR has recently issued SRO 179(I)/2013 to provide amnesty to such fraudulent elements allowing them to pay just 2 percent sales tax instead of 5 percent as levied under SRO 1125(I)/2011.
This premier and largest Chamber which represents the business and industrial community of Karachi which generates 68 percent revenue for the national exchequer has already brought to the notice of Chairman FBR through various letters copies attached/ statements in the press/ electronic media that KCCI cannot and will not accept any imposed decision by the FBR and its officials at their whims and discretion causing resentment and negative reaction within the trade and industry in Karachi.
The discriminatory SROs being issued one after another tantamount to adding up further to the sufferings and multiple threats already faced by the business community in this city.”, this was stated by Muhammad Haroon Agar, President of Karachi Chamber of Commerce and Industry (KCCI) during meeting with Muhammad Raza Baqir, Member Inland Revenue – Operation, Federal Board of Revenue at KCCI.
He asserted to rescind the aforementioned SROs and immediately consult all the concerned stakeholders in this regard. Sweeping changes in taxation policy and rules through number aforementioned and other SROs have caused a negative impact on business and industrial activities due to higher rates of sales tax and assigning the role of With-holding agent to exporters, importers, suppliers and processors.
He demanded that all SRO’s and changes made in rates of Sales Tax, Income Tax and rules introduced after 31st December, 2012 must be held in abeyance and their implementation should be deferred until consultations are held with all stakeholders, chambers and trade bodies.
Muhammad Raza Baqir, Member Inland Revenue – Operation, Federal Board of Revenue speaking on the occasion apprised that FBR cannot ignore Karachi Chamber of Commerce and Industry and look forward to the KCCI’s proposals on SROs recently issued for consideration and necessary changes in the forthcoming budget.
He was of the view if Chambers/Associations may take the responsibility and verify the genuine cases, the FBR can release refund claims and relevant system can be installed at KCCI. He said that tax-to-GDP ratio was very low; out of 180 Million population figure, the tax-payers percentage was only 0.7 percent. 25 percent revenue is collected from taxes levied on petroleum products.
He stated that 50 percent of the exports were from textile sector which is zero-rated. There were 130 to 140 items falling under zero-rating. He revealed that the refunds were on higher side than collections which point out loopholes in the system and indulgence of some FBR officials in corruption. Fake and flying invoices and corruption cannot be eliminated as the FBR lacks the capacity to stop/eliminate frauds.
He disclosed that FBR has collected data of 6 Million tax-evaders to whom notices will be served and names will be public under “name and shame programme” if they don’t pay the minimum taxes under amnesty scheme. He said that FBR has no choice but to give amnesty and the department does not hold the capacity to handle new 6 million tax-payers.
Former President KCCI Majyd Aziz, Senior Vice President Shamim Firpo, Vice President Nasir Mehmood and the Managing Committee Members and KCCI’s members from trade and industry particularly from textiles, chemicals and yarns also participated in the meeting.
For more information, contact:
M. Shafiq Baig
Public Relations Officer
Karachi Chamber of Commerce and Industry (KCCI)
Aiwan-e-Tijarat Road,
Shahrah-e-Liaquat, Karachi-74000
Tel: +9221 9921 8001 -09
Fax: +9221 9921 8010
Email: pro@kcci.com.pk, pro2@kcci.com.pk
Website: http://www.kcci.com.pk/