Some demands of business and industry accepted

ISLAMABAD: The finance ministry on Friday agreed to make 125 amendments to the finance bill, including a reduction in withholding tax on industrial importers to help revive the ailing industrial sector.

‘The amendments will be tabled next week,’ a finance ministry official said.

The government also constituted a committee to find anomalies in the budget and to remove them in two months to help revive industrial growth.

The decisions were taken during a meeting of representatives of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) with Finance Adviser Shaukat Tarin.

According to the official, industrial importers will now have to pay two per cent withholding tax instead of four cent. Although investors would pay the tax at an adjustable rate, commercial importers would pay four per cent.

Final tax on export proceeds would be paid at the rate of one per cent.

Earlier, the government had withdrawn the presumptive taxation on exporters, a move which was strongly opposed.

The ‘anomaly committee’ would be headed by Mr Tarin and its members will be the governor of the State Bank, chairman of the Federal Board of Revenue, federal secretaries of economic ministries and an FPCCI representative.

The finance ministry official said the business community was informed that the interest rate would be cut by one per cent and additional measures would be taken for lowering inflation.

The meeting agreed to do away with the judicial powers proposed to be given to FBR authorities, Section 40B would be used in a useful manner and not be used in any way that might put the business community in any difficulty.

It was also agreed that proposed amendment to Section 38 would be subjected to some conditions as tax authorities would not be allowed to enter business premises or carry out a search and prior approval would be required from FBR chairman. Private auditors would be required to place records and computers impounded from taxpayers’ offices in FBR offices and not anywhere else.

Participants of the meeting decided that there would be no requirement to mention the NTN or Computerised National Identity Card on sale invoices. The meeting was informed that audit under the Universal Self-Assessment Scheme would cover accounts of only past year. Previously taxpayers were required to furnish records spanning over four to five years.

The government also agreed not to set up an income tax intelligence directorate. The government said it would provide business community with an environment conducive to enhancing exports and allow imports without harassment.

A statement issued by the FPCCI said that the federal government had agreed to rectify what it called massive anomalies in the budget.

Mr Tarin, it said, had assured leaders of the business community to amend labour laws and remove irritants.

Karachi Chamber of Commerce and Industry president Anjum Nisar said that the finance ministry had accepted 90 per cent of the demands of his chamber. link...