Automation of refund system sought

Business body says responsibility should rest with SBP for reducing complaints

The tax refund system should be automated and its responsibility should rest with the central bank in order to reduce complaints and corruption, and improve the economic situation, said Federation of Pakistan Chambers of Commerce and Industry’s (FPCCI) Central Standing Committee on Insurance Convener Dr Murtaza Mughal.

In a statement on Saturday, Mughal said the Federal Board of Revenue (FBR) seemed to be more interested in keeping tax refunds rather than collecting taxes, which was damaging the fragile economy.

Mughal added that the government was trying hard to inject new blood into the economy and restore confidence of the business community but the tax mechanism was working against it.

“Unrealistic tax targets had compelled the FBR to strangulate business activities through highhandedness to show performance,” he remarked.

Mughal said the FBR continued to issue Statutory Regulatory Orders (SROs), which hurt the government’s intention to spur growth.

He pointed out that recently SRO 889 was issued for the surveillance of factories, which was opposed by industrialists as it would lead to harassment, corruption and litigation. Similarly, through two SROs, banks have been directed to report anyone withdrawing Rs1 million or more and depositing Rs10 million or more while real estate agents have been directed to report all sales and purchases to the FBR.

“These SROs will damage the realty sector, discourage investment and may reverse the gains made through the construction package, amnesty scheme and other incentives offered by the government to spur growth,” Mughal lamented.

He pointed out that all over the world, the real estate market was kept insulated from fear, raids and unnecessary audits but in Pakistan it’s different, which was one of the reasons Pakistanis ignored the local market and invested in the realty sector of other countries.

Published in The Express Tribune, October 11^th, 2020.

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