In a bid to play its due share in budget-making, Rawalpindi Chamber of Commerce and Industry (RCCI) has submitted its suggestions to the Federal Board of Revenue (FBR) for incorporation in the federal budget 2019-20.
A statement from RCCI President, Malik Shahid Saleem, noted that the proposals had been categorised into income tax; sales tax and customs duties with a special focus on the documentation of the economy.
He added these proposals would help increase economic activity, incentives for manufacturing and SMEs and widen the tax net, thereby, increasing the government revenue.
A key proposal related to income tax remains to broaden the tax base. It was suggested that the discretionary powers of the inland department should be restricted since it leads to abuse of authority and harassment.
The government should take additional measures to incentivise exports among other measures to ease the cost of doing business and improve the overall regulatory regime. This was said to in turn facilitate exporters.
RCCI asked for tax and audit exemptions for the first two to three years. Active Tax Payers List (ATL) was asked to be upgraded on a weekly or monthly basis while National Tax Number (NTN) or Chamber membership should be made compulsory to start new businesses or obtain commercial electricity/gas meters.
Tax filers were asked to be given privileges in hospitals, schools, airports, banks and even given powers of attesting authority. Reduction in the rate of income tax has also been sought.
Tax holidays may be introduced for new business ventures for at least first five years from the date of incorporation for those taxpayers who incorporate their businesses as LLP/Companies.
In the case of small companies, the rate of income tax might be reduced from the current 25 per cent to 20 per cent. Small companies should also be exempted from being a withholding agent to deduct taxes and file statements.
On October 16, 2018, the Ministry of Finance (Revenue Division), through its notification SRO-1065(I) 2018 may be removed with an immediate effect. However, the percentage of sales tax may be reduced to 10 per cent non-adjustable, non-returnable while 17 per cent of the sales tax on sales value might be abolished. It is said to lead to miscalculations and malafied working.
The investigation regarding revenue sources should be abolished in SME Trading Companies uptill 10 million and SME Manufacturing Companies 25 million.
A single online integrated sales tax returns filing procedure might be introduced for Federal and Provincial Sales Tax declaration in lieu of current separate filing requirements for federal and each province.
The limit for retailers/AOP’s should be increased to up to Rs 50 million Turnover Tax. Allowing income tax refund within a month, automatically to salaried individual’s days, auto credit and Invoking Section 140 may be suspended till the decision of first appeal and status quo.