KCCI raises concerns over retrospective CVT implementation on motor vehicles

KCCI raises concerns over retrospective CVT implementation on motor vehicles

Karachi Chamber of Commerce and Industry (KCCI) has taken a stand against the retrospective implementation of the Capital Value Tax (CVT) on the transfer of motor vehicles. President of KCCI, Mohammed Tariq Yousuf, has assured members of the Automotive Traders & Importers Association (ATIA) that the issue will be raised and addressed.

During a meeting between KCCI and ATIA, Ch. Amir Ali Khan, President of ATIA, expressed deep concerns regarding the demand for CVT by the Excise & Taxation (E&T) Department. Although the CVT became effective on July 1, 2022, the E&T Department did not implement it immediately. After a delay of 10 months, the department is now retrospectively demanding the CVT, which is technically not feasible.

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The ATIA delegation sought KCCI’s assistance in resolving this pressing issue. They pointed out that it would be impractical for showroom owners to arrange 1 percent CVT on each transfer for vehicles that have been sold and transferred multiple times over the past 10 months. They suggested that CVT should only be applicable to current sales and transfers, rather than demanding it for all the transfers during the past 10 months.

President ATIA Ch. Amir Ali Khan blamed the E&T department for the delay in implementing the CVT and failing to understand the instructions from the Federal Board of Revenue (FBR). He emphasized the unfairness of penalizing showroom owners for the department’s mistake and called for relief by applying CVT only to future transfers.

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The ATIA delegation also expressed concerns about the increasing street crimes near car showrooms located on New M.A. Jinnah Road, University Road, and Khalid Bin Waleed Road. They highlighted the lack of police patrolling in these areas, which creates opportunities for criminals to carry out fearless daylight robberies. The delegation urged KCCI to raise this matter with higher authorities in the police department.

Regarding the ongoing development work on New M.A. Jinnah Road for the Red Line bus route, the ATIA delegation criticized the reduction in road size, which would lead to severe traffic congestion and negatively impact local businesses. They proposed the construction of an elevated pathway as an alternative solution to address the traffic congestion issue and minimize losses for local businesses.

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In response to the concerns raised by showroom owners, President KCCI Mohammed Tariq Yousuf promised to take up the issue with the E&T department to provide relief. He also assured that the matter concerning the construction of the Red Line bus route would be discussed with relevant authorities for an amicable resolution, allowing showroom owners and shopkeepers to continue their business activities without disruption.

Regarding the rising street crimes, Tariq Yousuf advised the ATIA delegation to arrange two Suzuki Vans along with drivers that can be provided to local police stations for patrolling in the area. He stated that KCCI would assist in convincing higher authorities in the police department to provide police force and wireless equipment for these vans, but it would be the responsibility of the ATIA to arrange and maintain the vehicles and drivers. He cited the successful provision of a similar service by the Karachi Chamber in various commercial markets under KCCI’s Police Chamber Liaison Committee in District South.

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KCCI’s proactive approach to addressing these concerns demonstrates its commitment to supporting businesses in the automotive sector and ensuring a safe and conducive environment for trade in Karachi.