FBR likely to reduce turnover tax

The FBR has agreed in principle to reduce the rate of tturnover tax imposed on distributors.

The Federal Board of Revenue (FBR) has agreed in principle to reduce the rate of turnover tax imposed on distributors, businesses with a high turnover and loss-incurring companies. It is expected that the tax rate will go down from one per cent to 0.1 per cent.

Sources revealed that the FBR has received a report from the National Assembly’s Standing Committee on Finance which has recommended a reduction in the one per cent turnover tax imposed in the 2010-11 budget.

A senior official of the FBR told The Express Tribune that the proposal sent by the standing committee was being considered and a final decision would be taken after a detailed review.

Meanwhile, Chairperson of the Standing Committee on Finance, Fouzia Wahab, has confirmed that the committee had unanimously approved the reduction in turnover tax and that the recommendations had been forwarded to the FBR. She added that the FBR has given assurances to implement the proposal and would soon issue a notification in this regard.

Once the FBR reviews the recommendations put forth by the standing committee, it will send a summary to the Ministry of Finance. The ministry will then bring up the issue in the Economic Coordination Committee, where all stakeholders will be present to discuss the matter in detail.

Published in The Express Tribune, July 14^th, 2010.