Chairman of Pakistan Industrial and Traders Association Front (PIAF) Irfan Iqbal Sheikh has said that businessmen are worried because of the revenue shortfall that has impacted the development strategies of successive governments. He stated this while talking to a group of newsmen here on Thursday. Former presidents of Lahore Chamber of Commerce and Industry, Sohail Lashari, Mian Anjum Nisar and Muhammad Ali Mian were also present on the occasion.
The issues are being aggravated and not a single government tried to address them in past four decades. The issues can be resolved provided government show political will, he added. He said the government would have either to increase tax base or enhance indirect taxes while the tax collecting machinery is generally busy in finding out ways to enrich their purses through draconian laws.
He claimed that 80 percent of the total taxes are collected by businessmen indirectly on behalf of the Federal Board of Revenue. Elaborating his point he said 85 percent of the income tax is collected through businessmen that act as withholding agents. He said recently the government has devised another indirect way of harassing businessmen by levying 0.3 percent withholding tax on all bank transactions above Rs 50,000. He said this job is assigned to the banks. He wondered about operating a huge department like FBR when all taxes are to be collected indirectly.
Irfan Iqbal Sheikh said all traders want full documentation as they are paying indirect taxes in higher amount then their actual tax liability. He said 100 million mobile phone subscribers pay both income tax and sales tax on their bills. He said the 13 million power consumers pay GST and those with higher bills pay withholding tax as well. Same is the case in gas bills, he added. Shiekh said those who are income tax filers are entitled to get refund of all the withholding taxes they pay after they have filed their tax returns. However he added no refunds have ever been made. He said small traders are afraid of the arm twisting tactics of the FBR and the track record of the government that continue to squeeze those only that are in tax net. He said that as a taxpayer he has faced harassment from tax collectors.