KARACHI: Overseas Investors Chamber of Commerce and Industry (OICCI) submitted comprehensive taxation proposals for the upcoming 2017-18 Sindh budget representing the collective recommendations of foreign investors.
OICCI proposals are focused on accelerating economic growth and foreign direct investment (FDI) inflow in the province and the country. OICCI President Khalid Mansoor said that OICCI members highly appreciated the action of the Sindh Government for reducing the rate of sales tax on services, from 15 percent to 13%, over last two years.
The members of the chember had noted that despite the reduction, Sindh Government through Sindh Revenue Board was able to increase its tax collection on services by 21 % in the first six months of the fiscal year 2016-17 as compared to the corresponding period in 2015-16, highlighting the fact that lower tax rates lead to higher collections. OICCI’s budget recommendations for Sindh included : agricultural income should be taxed on actual and not notional income, including rent income of absentee landlords—sales tax rate on services in Sindh should be further reduced from 13% to 10% over the next three years for registered entities—telephone usage sales tax rate of 18%, should be made equivalent to GST rate on services—services of pharmaceutical industry and exports by registered persons should be zero rated—stamp duty on purchase orders should be eliminated as it is a tax on instrument, not on a transaction.
The OICCI document for Sindh also included recommendations for a better coordination between all sales tax authorities in Sindh, Punjab, Khyber Pakhtoonkhwa and Baluchistan and with Federal Bureau of Revenue (FBR)– a uniform definition of taxation of services and jurisdiction be agreed to facilitate the tax-payers and both life insurance and health insurance, which do not fall within the scope of definition of service, should be permanently included in the list of exempted services as was the case in Punjab province.
Overseas Investors Chamber of Commerce and Industry (OICCI) is collective voice of nearly 200 members representing nearly all the largest foreign investors in Pakistan, who contributed annually over one third of the revenue collections in the country by the Federal and Provincial revenue authorities and invest over dollars 1.5 billion annually in new capital expenditure.
OICCI is the largest chamber in terms of economic contribution and Corporate Social Responsibilities (CSR) initiatives by its members, which benefit over 20 million underprivileged sections of society, OCCI President highlighted.
