KARACHI: The Overseas Investors Chamber of Commerce and Industry (OICCI) has given robust taxation proposals for the federal budget 2015-16 to the Federal Board of Revenue (FBR) chairman.
The OICCI has given over 100 recommendations, including incentivise investors, broaden the tax net through documentation of the economy, simplify the tax system and reorganise the FBR etc.
The OICCI said that long-term investment plans should be suitably protected for at least five-year period for investors to base their plans on policies which are consistent and predictable.
It further suggested incentives include increase of tax credit under section 65A of Income Tax Ordinance, rebate for entities issuing electronic invoices to curb “flying invoices,” extension of tax credit under Section 65B till June 30, 2018, credit under section 65C at 15 per cent to be given for three tax years from year of listing.
With key focus on promoting large investment in the economy especially FDI, OICCI taxation proposals state that policies which lead to longer term investment plans should be suitably protected for at least a 5 year period so that investors could base their plans on policies which are consistent and predictable.
OICCI has proposed that there should be only two tax regimes for companies assessed under Large Taxpayers Units (LTU) or those registered under Sales Tax Act: the normal tax regime based on taxable income or under the Alternate Corporate Tax (ACT) mechanism.
To avoid delays in processing income tax and sales tax refunds OICCI has proposed that time frame for scrutiny of these refunds should be legally reduced to 30 days.
The culture of Amnesty Schemes should be completely eliminated as it discourages the honest tax payers. Severe, and visible, penalties should be enacted in the law to punish tax evaders.
In respect of Sales tax OICCI has proposed that Sales tax rates should be reduced in line with the regional countries to about 12pc. OICCI has stated that currently over 85pc of tax collections is through WHT which is very high and must be reduced.
