LAHORE: The Lahore Chamber of Commerce and Industry (LCCI) President Sheikh Muhammad Arshad has said that inappropriate evaluation mechanism promoting smuggling, therefore, it should be improved for the cause of economy.
He was addressing a delegation of businessmen led by Syed Mukhtar Ali, here at the LCCI on Saturday. LCCI Vice President Nasir Saeed, former president Muhammad Ali Mian, Executive Committee Members Ch Khadim Hussain, Najmul Hassan, Waqar Ahmed Mian, former EC members Zeeshan Khalil, Tahir Manzoor Ch Muhammad Hashim and others also spoke on the occasion.
The LCCI president said that high duties on import of low cost raw material are hitting business hard. He said that appropriate evaluation system and cut on duties and taxes on smuggling-prone items could discourage illegal trade.
Sheikh Muhammad Arshad said that business community is the driving force for the economy therefore their suggestions should be the part of this important document. He said that government should focus on grooming trade and industry rather than focusing on Income Tax, Sales Tax, Customs Duty and Federal Excise duty and imposition of new taxes.
The LCCI President said that attachment of account and delay in refund claims have become big issues which should be tackled on war footing. He said that Federal Board of Revenue should stop attaching business accounts in the larger interest of the economy as it should be last option, not the priority. He said that this practice of FBR is pushing the taxpayers to the wall. He said that FBR should focus on controlling under-invoicing and curbing the meance of smuggling besides expanding tax net but it is playing arm-twisting by instituting cases for recovery of outstanding dues and attaching bank accounts. He said that it is unfortunate that the FBR is not releasing what it owes to the business community but creating troubles for the businessmen for the recovery of its outstanding dues just to meet the revenue targets and for the sake of show performance.
He also urged the Federal Board of Revenue to release stuck-up sales tax and income tax refund claims at the earliest as undue delay has triggered serious liquidity crunch for the businessmen that might lead to closure of several industrial units because of financial crunch. He said that all the backlog of refunds should be cleared within two months of the filing of return. This one time clearance would clear the backlog. He said that Banking bonds may be issued for large amount of refunds withheld since years. He said that income and sales tax refunds should be issued without application within 90 days of their becoming due. There should be an automatic payment of compensation if any refund is issued after 90 days. Compensation equal to KIBOR per annum shall be paid to the taxpayer; whether the taxpayer claims the compensation or not. A mechanism should be put in place whereby the officers responsible for delay are also identified.
Sheik Muhammad Arshad also demanded withdrawal of Punjab Infrastructure Development Cess (PIDC) as it would cause irreparable damage to the business community of Punjab. He said that trade and industry would be hit by the move and it would result in increased input cost. He said that businessmen are already coping with a number of internal and external challenges while Punjab Infrastructure Development Cess would further add to their miseries.
He said that Projects like CEPC have the potential to stimulate the local economy through increase in the demand of locally manufactured goods. Such increase in demand will not only allow the full utilization of existing manufacturing capacity but will also encourage the manufacturers to increase their capacity. This will generate much needed employment opportunities and increase the government’s revenue.
Head of the delegation Syed Mukhtar Ali called to bring down the rate of income tax, sales tax and customs duty. He said that 17% sales tax is too high and should be single digit. He said that commercial importers have to pay 3% additional tax while have to pay 17% sales tax again on sale. Such consolidated tax rate is too high which should be brought down. He said that discretionary powers of tax machinery should also be reduced as they are creating harassment amongst the business community. He also called to control the menace of smuggling which is not only damaging the local industries but also causing huge loss to the national exchequer.
LCCI former president Muhammad Ali Mian said that the Lahore Chamber of Commerce & Industry has focused trade and industry in its budget proposals and new proposals are being forwarded to the government. He lauded the efforts of LCCI president Sheikh Muhammad Arshad for raising the voice of business community in the policy corridors.
