Business News

FBR Blue

Committee may recommend reduction in withholding tax provisions

ISLAMABAD: A committee constituted to simplify taxation procedures may recommend a reduction in the number of withholding tax provisions and measures for enhancing the revenue collection.

Sources in the Federal Board of Revenue (FBR) said that a technical committee was constituted on September 17, 2020, for simplification of all taxation procedures.

They said that the committee likely to submit its recommendations during next month for incorporation into the budget.

The committee was assigned to propose measures to reduce the dependence on withholding taxes, minimum tax, advance tax, etc.

According to the terms of reference (TOR), the committee would identify distortion, anomalies, and inequalities in the taxation system which cause difficulties for taxpayers, or discourage investment, industrialization, and documentation, and propose solutions.

Further, the committee is also required to propose measures for simplification of all taxation procedures, in a manner that does not compromise revenue collection and documentation.

The committee is also required to propose measures for improvement in the temporary importation and manufacturing bond schemes in order to enhance their scope and facilitate direct and indirect exporters throughout the value chain.

The committee has been asked to propose remedies for issues relating to adjustment of input tax paid against services subjected to sales tax by the provinces.

Meanwhile, the committee shall also identify issues hindering the smooth processing of refund claims through the FASTER system.