'CBR may reduce sales tax on services next year'

The Central Board of Revenue (CBR) might consider reducing the rate of sales tax on services sector next year. This was the observation made by Shahid Ahmed, Member, Sales Tax, Central Board of Revenue, at the concluding session of the two-day workshop on 'Sales Tax' here on Friday, July 22.
The workshop was held under the auspices of Income Tax Bar Association (ITBA), Karachi, to evaluate the core concepts of sales tax and difficulties faced by taxpayers.
Shahid praised the taxpayers for compliance of the tax laws and the increasing culture of paying taxes.
He said that currently the total number of the taxpayers was only 100,000, but the simplified tax procedure had increased the tax returns to 90 percent. "A remarkable improvement, indeed," he remarked.
"The CBR has made major changes in the sales tax laws during the past two years and now 90 percent of the registered assessees are filing their tax returns. Previously, it was 50 percent with 165,000 registered firms", Ahmed said.
He minced no words when he said that the taxpayers and tax dodgers would be treated differently.
He agreed with the demand of the businessmen that sales tax procedure should be simplified for the convenience of the taxpayers.
He also talked about sales tax litigation's and said that amendments in the last two years had brought down their number considerably.
In response to the demand by the participants to reduce sales tax rate he said that CBR might look into the matter and reduce the sales tax rate. He rejected the claim that the current rate was 15 percent. According to him, it ranged between 7 and 8 percent.
Eminent businessmen spoke on different topics and analysed the shortcomings and difficulties in the sales tax system.
The topics were Core Concepts, Registration, Determination of tax liability, Book Keeping, records and returns; Penalties and additional tax, Audit, rules and special procedures; Adjudication, appeals and ADR, and Provincial sales tax on services.