KARACHI: Federal Board of Revenue (FBR) has been advised to make one-page simple income tax return form and that should be available in Urdu and English to facilitate taxpayers.
In its proposals for budget 2020/2021, the Karachi Chamber of Commerce and Industry (KCCI) said that every year changes are made in income tax form and ironically, it becomes more confusing and difficult for the tax-payers to fill.
It is particularly cumbersome for the Small and Medium Enterprises (SMEs) including individuals and Association of Persons (AOPs).
The KCCI said that taxpayers have to seek assistance from consultants and pay large amount of fee only to comply with the requirements of tax return.
Due to the changes every year, tax-payers have to wait for the new form to be issued by the FBR which takes a month or two after the new budget is approved.
“The complicated form only helps the business of consultants and tax practitioners at the expense of compliant taxpayers,” the KCCI said.
It is one of the reasons that many individuals prefer to stay out of tax regime and a deterrent to broadening of tax base.
The Karachi Chamber proposed that separate income tax return forms for companies, AOPs, individuals and salaried class should be created.
Forms for SMEs and individuals and retailers should be a simple one page form both in English and Urdu.
Manual completion and filing should be allowed for individuals and SMEs in order to encourage documentation.
Extreme penalties and charges should be avoided in case of late filing.
Errors/short payment should be notified to registered person within two months of filing and correction of errors should be allowed to tax-filer for up to 3 months of filing without requirement of commissioner’s approval.
The chamber said that incorporation of proposal will help in simplification of filing procedures and documentation. Besides it will also help in broadening of tax base and increase in number of filers.
Further, it will save unnecessary expenses on fees of consultants and tax practitioners. It will eliminate corruption and harassment.