Documentation a must for economic growth: IT commissioner

Commissioner Income Tax Asim Majid Khan has said that documentation is a must for economic growth and cooperation of business community is of utmost importance.

He was speaking at the Lahore Chamber of Commerce & Industry on Thursday. He said that trust building between business community and the Federal Board of Revenue would help tackle issues in a winsome manner. He said everyone should fulfill his responsibility by paying taxes.

The Commissioner said the FBR had taken good measures regarding bank account attachment and audit. "We are ready to talk to traders at the platform of the Lahore Chamber of Commerce & Industry," Asim Majid Khan said and added that our doors are always open. He agreed with the Lahore Chamber that genuine refunds should be paid as soon as possible. He said increase in direct taxes can bring down the ratio of taxes to a single digit.

Speaking on the occasion, LCCI President Irfan Iqbal Sheikh said that misuse of discretionary powers by the tax officials is hampering the smooth running of businesses and coming in the way of tax net expansion.

While calling for expediting stuck-up refund claims, he said delay in release of huge funds has triggered serious liquidity crunch for the exporters and manufacturers that might lead to closure of several industrial units. He said an effective system should be developed for early payments of refunds.

He said the government deducts 4.5 percent un-adjustable withholding tax on supplies from the traders. He said percentage of withholding should be reduced and it should be adjustable. He said ratio of turnover tax should be reduced and traders should be given option to avail fixed tax scheme or turnover based taxation. He said that fixed tax scheme should be on turnover instead of covered area.

Irfan Iqbal Sheikh said that sales tax should be reduced from existing 17% to a single digit to bring down input cost of the industrial sector. He said tax return form should be easy to understand and should be on a single page.

The LCCI President proposed that new taxpayers should be given exemption from tax audit for at least four years that would encourage others to come into the tax net. He said the FBR has shifted its tax collection responsibility to the withholding tax agents who are collecting tax. Instead of acknowledging their services, tax officials tease them with the tactics of monitoring, enforcement and recovery of levy etc. This practice should be stopped to give a breathing space to the businessmen.

LCCI Senior Vice President Ali Hussam Asghar said that businesses are facing financial crunch due to delay in refunds therefore this issue must be resolved immediately. He said that business community wants to be a partner to the government for tax collection but first the government would have to accept our proposals. He said the Lahore Chamber of Commerce & Industry is going to start taxpayer education program soon. LCCI Vice President Mian Zahid Jawaid Ahmad also highlighted the issues being faced by traders and presented vote of thanks at the end of meeting.