'Federal Tax Ombudsman Sends Viable Budget Proposals To FBR'

LAHORE, (APP - UrduPoint / Pakistan Point News - 2nd Jun, 2024) Federal Tax Ombudsman (FTO) Dr Asif Mahmood Jah has sent a set of 24 viable and business-friendly budget proposals on income tax, sale tax and customs to Federal board of Revenue (FBR) mainly aimed at accelerating the economic growth and development.

FTO Advisor Dr Waqar Chaudhry disclosed this, while addressing an awareness session for business community arranged under the aegis of Coordinator to FTO Meher Kashif Younis, here on Sunday.

He said that FTO’s all proposals are based on the solid suggestions solicited from presidents of chambers, stakeholders and leading trade associations at an important meeting of central advisory committee.

In order to promote entrepreneurship and corporate culture, it has been proposed that the rate of corporate tax may be reduced from 29 percent to 20 percent. Although, tax credit is available to startups, but corporate tax rate is too high for a company aging three years.

He said there are prolonged delays in issuance of refund under Section 170, therefore, it has been proposed that automated system of refund processing may be introduced to process refunds to the extent of Rs. 50,000 automatically.

Recently, fee for filing of appeals have been drastically increased putting extra burden on taxpayers. Therefore, it has been proposed that appeal fee may be reduced to affordable level.

He said a tax credit at 10 percent was available for investments in plant and machinery replacement, and business modernization due to the fact that such investment creates industrial growth and job opportunities. However, this was withdrawn without any logic. It has been proposed that tax at 10 percent be restored under section 65B to attract investment.

Dr Waqar explained that the salaried class is most hit by the increasing cost of living. The utilities and travelling cost has increased manifold, therefore, it has been proposed that the limit of income not chargeable to tax be enhanced to Rs. 1,200,000 from existing Rs. 600,000. It was also proposed that all income must be taxed irrespective of source of income which will increase tax collection.

He said recently introduced Tajir Dost Scheme specifies payment of minimum tax as advance tax on a monthly basis, which creates difficulties for the small traders & shopkeepers. Therefore, it has been proposed that payment of minimum advance tax may be amended to annual or biannual basis instead of monthly basis.

He said filling tax returns permission application kept pending unattended and the registered person is unable to file its monthly sales tax returns, therefore, it is proposed that the application for filing of Sales Tax Returns may be automated and be processed within 15 days of filing of such application.He said the terms of property developer, property promoters , builders have neither been defined under the Sales Tax Act, 1990 not in Islamabad Capital Territory (Tax on Services) Ordinance, 2000, therefore, may be defined under section 2 of the Ordinance as proposed accordingly.

Mian Faiz Bukhsh, a leading tax advisor, and other participants appreciated the efforts of FTO for compiling results-oriented budget proposals reflecting the genuine demands of business community and stakeholders in the larger national interest which will help greatly restore the confidence of foreign and local investors.