Karachi Chamber Demands FBR Address Controversial SRO 350

Karachi Chamber Demands FBR Address Controversial SRO 350

Karachi, July 9, 2024 – The Karachi Chamber of Commerce and Industry (KCCI) has urged the Federal Board of Revenue (FBR) to promptly resolve the ongoing issues related to SRO 350 (I)/2004, which have been a source of significant concern for the business community.

In a formal letter to the FBR, KCCI President Iftikhar Ahmed Sheikh highlighted the unresolved complications arising from the SRO, noting that it has caused considerable anxiety among businesses. He emphasized the necessity for the FBR to reassess the SRO in collaboration with relevant stakeholders to mitigate its adverse impacts.

“The situation is critical,” said Sheikh. “Even essential utility providers like SSGC and K-Electric struggle to file their sales tax returns due to SRO 350’s complexities.”

Sheikh explained that SRO 350 establishes a dependency between the tax return filing of buyers and the compliance of suppliers. This dependency creates a systemic risk where non-compliance by suppliers can disrupt the entire supply chain, potentially jeopardizing operations across various sectors.

Additionally, the SRO mandates the submission of balance sheets, which may conflict with previously submitted data, adding another layer of complexity and potential disruption to compliance procedures. Businesses are particularly concerned about this requirement due to its perceived intricacies and the potential for inconsistencies.

“The lack of a registration system at the initial export stage for products such as livestock, meat, fish, vegetables, and fruits makes it impossible for filers to submit details about registered persons for sales tax returns,” Sheikh warned. “Further delay in addressing SRO 350 could halt exports of these critical products.”

The KCCI President further underscored the uncertainty and ambiguity surrounding sales tax return filing deadlines and the imposition of unreasonable liabilities. These challenges, he noted, are particularly burdensome for businesses already struggling with economic difficulties.

Sheikh called on FBR Chairman Malik Amjed Zubair Tiwana to engage directly with the KCCI to discuss these pressing issues. He suggested that if an in-person visit was not feasible, an urgent online meeting should be arranged to address the critical concerns raised by the business community.

The KCCI’s appeal underscores the broader challenges faced by Pakistani businesses in navigating regulatory complexities and underscores the urgent need for reform and clarity. The resolution of issues related to SRO 350 is seen as a crucial step in ensuring the smooth operation of businesses and maintaining the flow of exports, which are vital to the country’s economy.

In summary, the Karachi Chamber of Commerce and Industry’s demand for the Federal Board of Revenue to address the complications of SRO 350 reflects a critical need for regulatory clarity and cooperation. The business community hopes that the FBR will take swift and decisive action to resolve these issues, thereby fostering a more conducive environment for economic activity and growth.