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KARACHI: Dr. Aftab Imam, Chief Commission Inland Revenue, Corporate Tax Office (CTO) Karachi on Tuesday said that installation o Point of Sale (POS) machines to be extended to all types of shopkeepers.

Although installation of Point of Sales (POS) machines is currently mandatory for bigger stores/ shops falling under Tier-1 retailers. “But eventually, every shopkeeper will have to get the POS machines installed at their premises which was the only way to ensure that all the taxes being generated from sales were directly being submitted to the national exchequer,” he added.

READ MORE: FBR posts officials at retail outlets for sales monitoring

He was speaking at a meeting with office bearers of Karachi Chamber of Commerce and Industry (KCCI).

Dr. Aftab Imam said in order to quickly process the Sales Tax Returns being submitted in huge quantities every month by the taxpayers, a state-of-the-art IDEA software has been introduced at the Inland Revenue Department where the pilot run was going on smoothly hence, it was being expected that this software will be fully launched in July 2022.

READ MORE: Point of sale machines allowed tax credit

He invited KCCI’s delegation to visit IR department to witness the performance of IDEA software which would make things easier and help in dealing with the problems being faced by taxpayers in submitting sales tax refunds.

He informed that in order to improve the functioning of IR department, all the recruitments were now strictly being done purely on the basis of merit so that competent and hardworking workforce could be created which should facilitate the taxpayers instead of creating problems.

Chairman Businessmen Group & Former President KCCI Zubair Motiwala, who joined the meeting via Zoom, pointed out that many issues mostly pertaining to issuance of notices have been lying pending at numerous offices of the IR department which need to be resolved on priority. Huge number of notices including Withholding Tax Notices and Audit Notices were being issued to taxpayers without any justification which was a very serious issue hindering government’s ease of doing business policy, he said, and suggested that instead of seeking entire data and documentation from taxpayers, FBR should only collect information about any suspicious/ missing transactions without disturbing the entire flow.

READ MORE: CTO Karachi seals three retail shops on POS failure

He said that although taxpayers have been regularly submitting all the documentations on monthly basis yet the FBR officials without taking the already submitted documentation into consideration, demand the same documents again and any failure or delay in doing so creates a lot of problems for taxpayers who find themselves stuck up in a web of harassment. “To deal with these kinds of issues, it is really necessary to adopt state-of-the-art and completely flawless IT solutions as per international standards which would reduce human interaction and help in minimizing the incidents of harassment”, he added.

President KCCI Muhammad Idrees, in his remarks, suggested that FBR should focus on other cities as well because it seems that the current policies were being implemented in Karachi only which, despite so many odds and challenges, continues to contribute more than 65 percent revenue to the national exchequer yet, the business community of this city was being compelled to face notices and go through harassment. “Instead of squeezing the business community of Karachi, uniform policies have to be devised and effectively implemented all over the country”, he added and advised that tax collecting authority should initiate market-based awareness sessions which will be fully facilitated by KCCI.

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While appreciating the sincerity of Chief Commissioner towards promptly resolving the grievances being faced by the business community, Muhamad Idrees mentioned that a particular case, which was pending since last six months, was instantly resolved within one day as soon as it was brought to the notice Dr Aftab Imam who always tries his best to get other cases referred by KCCI resolved as well which pertain to any other department.

He opined that tax was a by-product of a vibrant economy and efforts for increasing tax collection can only yield desirable results through sustainable growth in economic activities. The measures taken through Supplementary Finance Bill will have a significant impact on the poor and middle-class segments due to increase in prices of consumer goods.

“The 17 percent GST imposed on formula milk, enhancement of tax from 5 percent to 12.5 percent on imported vehicles, 17 percent increase in prices of mobile phones exceeding $200 and Sales Tax on import of raw material which has also been increased from 5 per cent to 10 per cent while withdrawal of exemptions worth Rs31 billion will prove counterproductive to the economic growth and business development,” he added.

He further stated that it was very unfortunate that FBR has been allowed to freeze banks accounts of the businessmen and can enter any premises. “Such discretionary powers to tax officials were fueling corruption in the system. Such measures should only be taken after the businessman is proven guilty and should not be used as a tool to harass businessmen.”

Muhammad Idrees further pointed out that taxpayers were being harassed by issuing notices for monitoring and audit of multiple tax years and they were being compelled to comply to these notices in short period of time of merely 4 to 5 days.

“Hence, I propose that the field formations should be restricted from initiating proceedings of multiple years at once. Also, some minimum time period should be prescribed under the law which should be provided to taxpayers for responding to a particular notice,” Muhammad Idrees said, “To make the tax mechanism more efficient, unnecessary powers of FBR should be curtailed, audit process should be reformed and laws should be passed for harassment by minimizing person to person contact.”