KARACHI: The business community of Karachi has suggested that the government should make significant cut in taxes in the upcoming budget, which will help revive the businesses on the brink of bankruptcies owing to coronavirus.
During an online meeting between Karachi Chamber of Commerce and Industry (KCCI) and the Federal Board of Revenue (FBR) to discuss the proposals of KCCI for the Federal Budget 2020-21, KCCI President Agha Shahab Ahmed Khan said that the government should focus on extending support to the trader and industries to ensure their survival.
FBR Chairperson Nausheen Javaid admitted that in the prevailing economic scenario the taxation policies and upcoming federal budget should be formulated to help the trade and industry to cope with new challenges.
On the occasion, KCCI proposed to withdraw 3% further tax on local sales to unregistered buyers, which was initially 1% imposed through the Finance Act 2013. FBR Inland Revenue Policy Member pronounced that a proposal is under consideration to reduce the rate to 1% instead of 3% in the FY2020-21 and to zero per cent in the next fiscal year.
Moreover, the chamber has recommended a reduction in sales tax from 17% to a single digit. Inland Revenue Policy member accepted that the FBR will review the rate and recommend rationalising the same in the budget 2020-21. He further added that other relief measures in sales tax and other levies are also under consideration during the prevailing crisis due to Covid-19, which are outside the scope of federal budget 2020-21.
KCCI suggested reducing the WHT rate to 1%. The FBR official assured that the rate of WHT on local supply of goods will be rationalised as proposed.
Published in The Express Tribune, April 18th, 2020.
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