KARACHI: Business community has resented the decision of tax authorities to monitor production activities through cameras that will be directed connected to main tax database.
M. Shariq Vohra, President, Karachi Chamber of Commerce and Industry (KCCI) while terming the installation of cameras at the manufacturing facilities as counter-productive, demanded the Advisor to Prime Minister for Finance and Economic Affairs to intervene and issue directives to the FBR to withdraw such draconian rules promulgated through SRO.889(I)2020 and rescind the impugned SRO which is counter-productive to industrialization and economic growth.
He further suggested to review all existing provisions and discretionary powers vested in officers of Inland Revenue which are misused to harass tax-payers and only serve as a deterrent to broadening of tax base.
He said that such measures will only lead to deindustrialization because the industrialists are already fed up with many issues and problems associated with running the industry.
He pointed out that the industries are already over-burdened with high cost of electricity, load-shedding of gas and electricity, a crumbling infrastructure, lack of water-supply, high rates of Sales Tax, VAT, FED and WHT, Customs duties on raw materials, additional customs duty and regularity duty besides a plethora of local and provincial taxes. More regulations and stifling rules will further discourage fresh investment in industry, he added.
Shariq Vohra further emphasized that Industry in Pakistan is still in a growing phase and not yet ready to comply with such rules and deal with the discrepancies raised by officers assigned to monitor production. Such rules will inevitably result in harassment and corruption.
“It will be particularly difficult for the SMEs to comply with new rules in addition to existing complex tax regime, resource constraints and lingering effects of Covid-19 on all businesses.
He feared that amendments in tax laws through Finance Bill’2020 and a very large number of notifications, and SROs amending Rules and Procedures issued by FBR will further squeeze the tax-payers who are already burdened with a complex and coercive tax regime.
Against the advice of tax professionals and proposals of trade bodies, the bureaucracy continues to make compliance more and more difficult and creates deterrents to broadening of tax base.
He further commented that on one hand, the government has given a generous amnesty to the construction and real estate sector but on the other hand, exact opposite policy is being followed which will stifle all other industries that badly need liberalization and ease of doing business to overcome the losses suffered in the year 2020 due to Covid-19 and global economic slowdown.