Concerns Raised Over Tax Laws Impacting Business Climate

Karachi: The Vice President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Muhammad Aman Pracha, has voiced concerns about the impact of current tax policies on the business environment. He called for the government to revoke what he described as unnecessary powers granted to the Federal Board of Revenue (FBR) bureaucracy to help achieve tax collection targets more effectively.

Aman Pracha emphasized the need for an immediate review of Sections 37A and 37B of the Sales Tax Act, 1990. He pointed out that these provisions, which permit extensive powers to tax authorities, including arrest and prosecution, have fostered a climate of fear and uncertainty among both local and international investors. While the FPCCI supports transparent tax collection, Pracha stated that harassment and undue interference are detrimental to investor confidence and economic stability.

He also brought attention to the challenges faced by the business community in complying with a new income tax law affecting cash sales over Rs. 200,000 per transaction. The continuous introduction of new regulations, he warned, poses a threat to existing businesses and may discourage future investment.

Aman Pracha highlighted the adverse effects of a proposed 20% tax rate on companies operating in remote areas that rely on cash transactions to deposit in banks. This measure, he cautioned, could hinder tax collection efforts in those regions and disrupt the supply of goods to businesses there.