KARACHI: The Federation of Pakistani Chambers of Commerce and Industry (FPCCI) on Friday rejected the government’s move to move federal excise tax collection to the VAT system, a statement said in a statement.
Acting President of the FPCCI, Nasir Khan, said Pakistan’s business community opposes the longstanding imbalanced policies in the country, favoring the elite and stakeholders; At the same time, it promotes corruption in the ministries / institutions and in the economy.
The acting president of the FPCCI highlighted some issues facing the business community, such as the shift in federal excise tax to the VAT regime.
“Before this change, the federal consumption tax of 17 percent applied to raw materials in the import phase, see Table 1 of the first list with Section 3 of the Federal Consumption Tax Act 2005; which has now been withdrawn and the raw materials would now be collected and charged with sales tax of 17 percent. “
Khan said that due to the current shift, units in the federally administered tribal areas and the provincial administered tribal areas will enjoy tax breaks of around 25 percent, including VAT exemption in the value-added mode.
Such financial benefits only create a huge incentive for abuse of facilities and create an uneven field for doing business in the country, he added.
Khan also said that this year the FPCCI presented a growth model and proposed various possible measures to improve government revenues, economic growth and national prosperity through expanded and reinforced participation of all segments of the economy.
“Our suggestions for [the] no importance was attached to economic growth. Instead, various political measures were announced in the budgetary policy, which are completely against [the] Human rights, ”he added.
Section 203A EStV 2001, which authorizes and expands the discretion of the Federal Tax Office (FBR), would only lead to an increase in corruption and harassment.
“Although Section 203A was amended by [the] The introduction of plates and powers of arrest and prosecution will create an anxious and discouraging environment, ”added Khan.
He said the provisions should be added to hold the tax office accountable if it cannot detect corruption or tax evasion, which is evident that 95 percent of cases are dropped in the top courts.
Khan said the main reason people fail to register on the tax network is because of the FBR’s harassment and corruption.