Govt should focus on early FBR restructuring: Ather Kiani
LAHORE: It seems as a policy that Federal Board of Revenue (FBR) is discouraging manufacturing activities in Pakistan due to the cumbersome procedures of registration of sales tax (ST). The incumbent government should focus on early restructuring of the Federal Board of Revenue as its top priority to make it more efficient and forward looking institution. The government and top FBR brass should take stock of the undue demurrages and detention charges by the shipping lines and agents.
These views were expressed by the Lahore Tax Bar Association (LTBA) General Secretary Ather Naveed Kiani while exclusively talking to Customs Today here the other day.
He said that in most cases registration of manufacturing concern takes over one year due to the incompetence, corruption and non-corporation of the officials and officers of the FBR.
“Investors want to invest in Pakistan both local and international, however, when it come to the registration of the companies to the sales tax (ST).” Manufacturers are compelled to import only as they feel it difficult to get them registered in ST. The ST registration should be made easier in order to give boost to the economy and enhance revenue collection.
“No comprehensive future goals have been set for the capacity building of FBR, there is an emergent to enhance its efficiency in operational matters including audit and registration etc,” LTBA Secretary General Ather Kiani expressed.
While talking about the broadening of tax base, he said that insufficient measures have been taken to enhance tax net and despite several attempts the tax net is still narrow which is a testimony that insufficient measures have been taken and more work required to be done in this regard.
The indirect taxes are ratio is increasing while the direct taxes decreasing which is not favorable for the economic condition of the country, he said adding that there must be reasonable balance between the two types of the taxes.
“The FBR immediately should seek help from NADRA and by using the database the FBR should locate the potential taxpayers including luxury car owners and high electricity bill payers” he suggested adding that FBR need to build its capacity to deal with the matter including huge pending audits and refunds issues.
“Even if you bring investment and manufacturers, the minimum time to register a company is one year in FBR because there is no proper process and manufacturer is also afraid of getting fake invoices after getting registered which is hindering production which ultimately hinders exports and vacancies,” the LTBA secretary general highlighted. The secretary general said that there should be tax free exports to avoid the issue of refunds.
He noted that manufacturing a must portion for the economic development of a country and the FBR management should realize the need to support the manufacturing concerns instead of harassing them.
In answer to a question about the undue demurrage and detention charges by the shipping lines and agents ports, he said that such uncalled for charges defiantly adds to the per unit cost of the importers creating inflation. He urged the government and top FBR authorities should take stock of the situation in the larger national interests.
