AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
KARACHI: The Pakistan Chemicals and Dyes Merchants Association (PCDMA) has raised concerns about the increasing difficulties faced by taxpayers due to the complexities of the newly introduced Annexes H1 and J, along with technical issues related to Unit of Measure (UoM) requirements.
In a letter addressed to the Chairman of the Federal Board of Revenue (FBR), Rashid Mehmood Langrial, PCDMA Chairman Salim Valimuhammad, and Danish Saleem, Advisor to the Subcommittee for Sales and Income Tax, highlighted the confusion and compliance problems stemming from the new annexes. They noted frequent regulatory changes, unclear guidelines, and persistent portal glitches as the main challenges.
Salim Valimuhammad stated that the complex design of Annex H1 is making it difficult for taxpayers to reconcile withholding statements, leading to compliance issues. The form’s calculation mechanism, which incorrectly subtracts Sales Value instead of Cost Value, is identified as a significant flaw.
The PCDMA urged the FBR to allow taxpayers to voluntarily enter the Cost Value before submission to improve reporting accuracy and avoid erroneous assessments, delayed refunds, or penalties.
The association also pointed to similar challenges with Annex J, where fluctuating tax rates and unclear guidelines are imposing excessive burdens, especially on small businesses. The systemic flaw of deducting Sales Value rather than Cost Value persists in Annex J, contributing to inaccuracies.
Additionally, PCDMA members reported difficulties with the technical aspects of UoM codes. The unclear categorization of goods and services and system glitches are causing filing errors and delays, particularly affecting businesses with diverse inventories and involvement in import/export operations.
PCDMA emphasized the need for the FBR to consult with industry stakeholders before implementing significant changes. Such collaboration would help reduce errors and foster trust among taxpayers, according to Salim Valimuhammad.