Both cantonment boards, excise department contest each others’ jurisdiction.PHOTO: FILE
Businesses in the two cantonments of Rawalpindi are in a fix after receiving notices for payment of a ‘professional tax’ by two different tax bodies.
The Rawalpindi Excise and Taxation Department (ETD) and Rawalpindi and Chaklala cantonment boards issued notices to traders for payment of the tax last week.
The traders said they are being asked to pay the same tax twice terming it unjust as businessmen and vendors cannot be called professionals.
“The cantonment authorities say we fall under the federal government and the provinces have no authority to collect taxes from us while the ETD has its own version,” said Riyasat Ali, a member of Rawalpindi Traders Union.
Another trader said neither the cantonments nor the provincial government so far clearly defined the professional tax for us. “The notices are even served on vendors and fruit-sellers.”
He said the tax as its name indicates should be collected from engineers, lawyers and businessmen.
Saleem Satti, a vendor who sells groceries in Saddar, was caught by surprise after he received similar notices. Showing the notices, he said he hardly earns Rs500 a day. “First I am not a professional and second I received notices for same tax from two departments,” he said.
The traders demanded that only one department should collect the tax and from those only who qualify as professionals.
After the traders protested the notices, the Chief Executive Officer Chaklala Cantonment Board (CCB) Shahid Ahmad Khan told them not to pay the tax to the ETD. Both the departments have their own justifications to offer.
When asked about why the ETD is collecting the tax from traders housed in cantonment areas, Excise and Taxation Officer Latif Ahmad quoted the Punjab Finance Act 1977 and Punjab Professions and Trade Tax which, according to him, allows them to levy this tax.
Another official of ETD, Inspector Zaigham said the 70 per cent of the tax the ETD collects was from the cantonments. He said the tax is a provincial levy and “the mere fact that a person is housed in cantonment area does not absolve him of paying any tax.” He cited Article 163 of the Constitution that allows the ETD to levy tax on the professionals.
A senior officer of CCB requesting anonymity said cantonment areas fall under the federal government and Section 60 of Cantonments Act 1924 empowers it to impose any tax in any municipality in a province.
On the other hand, Zaigham said that professional tax is a strictly a provincial levy.
However, the CCB official termed ETD’s view as absurd and said it has no authority to collect such taxes in the cantonment areas
Published in The Express Tribune, February 13th, 2014.
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