LCCI Advocates For Business-friendly Taxation System

Lahore Chamber of Commerce and Industry (LCCI) Wednesday expressed reservations over 'Tajir Dost Scheme 2024' under SRO 420 and advocated for business-friendly taxation system to pave way for economic development, besides formulating all the economic policies in consultation with the stakeholders

LAHORE, (UrduPoint / Pakistan Point News - 27th Mar, 2024) Lahore Chamber of Commerce and Industry (LCCI) Wednesday expressed reservations over 'Tajir Dost Scheme 2024' under SRO 420 and advocated for business-friendly taxation system to pave way for economic development, besides formulating all the economic policies in consultation with the stakeholders.

LCCI President Kashif Anwar stated this in a conference on 'Economic challenges and their solutions' here at Lahore Chamber where LCCI Senior Vice President Zafar Mahmood Chaudhry, Vice President Adnan Khalid Butt and a large number of businessmen were also present.

Kashif Anwar expressed reservations over the SRO 420 under which 'Tajir Dost Scheme 2024' has been introduced, citing that the businessmen, who are outside the tax net and never filed a tax return, are asked to deposit advance tax every month under this scheme which is not viable as the shopkeepers would have to remain associated with the tax lawyers. Secondly, the tax would be determined based on the area of the shop and the value of the property, which has nothing to do with the sale. He suggested that this tax should be simplified and the shopkeepers would have to file a single-page return only once a year.

In this scheme, he claimed, instead of minimum tax, the tax should be adjustable according to electricity bills, which should not be audited. He said that the traders should be given facilities, concessions and in the same manner as VTCS-2016 was introduced, people should be informed about this SRO with clarity.

Kashif Anwar mentioned that recently, a new condition was imposed through SRO-1842 according to which such retailers whose withholding tax under Section 236H in 12 months is more than Rs 100,000 are bound for POS (Point of Sale) integration. This will increase the burden on small retailers and make it more difficult to achieve important goals like widening the tax net. Furthermore, provision of balance sheets and bio-metrics have been made mandatory for small businesses through SROs while as per the SRO, the turnover cannot be more than five times of the capital, otherwise the permission of the commissioner must be obtained.

Kashif Anwar urged the government to simplify the taxation system otherwise people would not come into tax net in the presence of audits, bank attachments and surcharges. He argued that the economic development cannot be possible until the problems of local industries are solved. He said that the government should introduce reforms on an emergency basis for the stability of the country's economy without wasting a single moment. He said that devaluation of rupee has created problems like increase in inflation, high rate of markup and high prices of electricity, gas, petrol, which have to be controlled immediately.

LCCI President said that LDA (Lahore Development Authority) demands 20 percent of commercial value as per its DC rate for conversion of existing industry and commercial area which is very high. RUDA (Ravi Urban Development Authority) and LDA officials also demand high rate of commercialization fee, which is not possible for the industry and businesses to manage immediately.

These issues should be resolved on priority basis and a friendly attitude towards traders should be adopted. He said that due to repeated increases in electricity and gas prices, the industry is facing serious problems as their cost of production has increased and they are unable to plan for the future. The government should reduce electricity and gas prices for the business sector.

Kashif Anwar also called for constructing parking plazas and strict measures against encroachments. He added that heavy regulatory advertisement fee is demanded by the Parks and Horticulture Authority (PHA) for those traders who use signboards only for identification.

He said that jewellers buy gold by paying the full amount to the buyer, but the police sometimes arrests the same man and bring him to the jewellers and blames for buying stolen gold, therefore, SOPs should be framed in this regard so that jewellers can be protected. He said that water hydrants should be installed in markets to cope with the fire incidents.

Kashif Anwar urged the law enforcement agencies to take steps to improve the law and order situation in industrial areas, markets and prevent businessmen from theft and robberies. He said that the interference of public departments in business matters should be minimized, citing that harassing the business community and closing the factory for minor lapses demoralizes the industry, so this should be stopped.

He said that government has also imposed MDI charges and electricity bills are being sent to the closed industrial units. He said that there should be a uniform water tariff in all cities.

Kashif Anwar said that the government has recently reduced the limit of axle load due to which cargo delivery charges have also increased manifold. Non-opening of letters of credit is also creating problems for the business community.

He said that the policy rate in Pakistan is 22 percent which is higher than other countries in the region which should be reduced. He said that the taxpayers, whose advance tax is with FBR, their last year's adjustment of advance tax has been cancelled by the government which is creating cash flow problem. He said that due to non-receipt of refunds and delays, the business community is suffering from problems. FBR should resolve these issues immediately. Regulatory duties, customs duties and additional customs duties should be abolished on the import of such industrial machinery and raw materials which are not manufactured in the country, he added.

He said that US $ 17 billion are being spent on the import of crude oil to meet energy needs. The government should promote alternative sources of energy and build water reservoirs including the Kalabagh Dam.

He said that the loss making state owned enterprises should be restructured or privatized.

He said that instead of sealing factories or filing FIRs under anti-smog and dengue campaign, warning should be given first and legal action should be taken only when the problem is not resolved.