KCCI laments ‘unjust’ tax on indenters

Already subject to 5% WHT by government on export earnings, says chamber’s chief

KARACHI: Unjust taxation will result in depriving the country from desperately needed foreign exchange earned by the indenters, said the Karachi Chamber of Commerce and Industry (KCCI) President Younus Mohammad Bashir.

Referring to the Sindh Revenue Board (SRB’s) decision on imposing 12% tax on indenting businesses, he said the board should take caution while sending notices to different businesses.

In a special meeting held to discuss and seek recommendations for the Sindh budget 2016-17, the KCCI President said, “the government, instead of appreciating our efforts, has decided to penalise us by imposing such groundless taxes which is highly unfair.”

He said indenters were not liable to pay service tax as they were not providing any local service and were already paying 5% withholding tax (WHT) to the federal government on export earnings.

“The indenters work on a very low rate of commission and face fierce competition in the international market. They negotiate the most competitive prices with foreign suppliers for raw materials and other products for a commission as low as 0.5% to 1%.

“Imposing 14% service tax on such a meagre commission, would surely make it impossible for businesses to stay afloat,” he added.

Published in The Express Tribune, February 3^rd, 2016.

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