ICCI urges FBR to reduce Withholding tax rate under section 153A ...

Islamabad,? Islamabad Chamber of Commerce and industry (ICCI) urged the Federal Board of Revenue (FBR) to reduce the proposed rate of 1 percent withholding tax from dealers, wholesalers and retailers that would be collected by the manufactures under section 153A in the Finance Bill 2012-13.

In a statement issued here Monday, Asad Farid, acting President ICCI said that imposition of 1 percent withholding tax puts undue tax burden on dealers, wholesalers and retailers, therefore Government should reduce this rate to encourage tax culture in Pakistan because potential taxpayers feel hesitant due to such practices and continue to remain outside the tax net.

He was of the view that it is not the job of the manufacturers to work on the behalf of the FBR for documentation of economy, thus the tax departments should not give this responsibility to the manufacturers to deduct withholding tax from dealers, wholesalers and retailers.

Asad Farid said that proposed one percent at source was much higher than of their taxable income and final tax liability which would mutilate their cash resources. He underlined the need to educate the small and medium taxpayers about the basics of sales tax registration and other procedures of sales tax laws. By ensuring the transparency, accountability and access to justice could improve tax culture in Pakistan, he maintained.

He emphasized on winning the public confidence by improving governance, eradicating corruption and pursuing equitable tax policies were essential for revamping tax collection system and pulling the economy out of economic crisis. ICCI Acting President stressed that Government should devise a comprehensive strategy to broaden the tax base and rationalize tax rates so that people should happily contribute towards paying taxes.

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