Banking transactions: KATI shares dismay over imposition of 0.6% tax
Says many businesses opting for cash payment to avoid the tax.
KATI President Rashid Ahmed Siddiqui, in a statement on Monday, said the trade and business community was in a state of agony due to the imposition of 0.6% withholding tax. CREATIVE COMMONS
KARACHI:
As the news of imposition of 0.6% withholding tax on banking transactions spread, several organisations and institutions have started voicing their concern over the levy.
The latest organisation adding its voice to the chorus is the Korangi Association of Trade and Industry (KATI), which has urged the government to withdraw the tax on banking transactions as it is hampering daily business activities.
KATI President Rashid Ahmed Siddiqui, in a statement on Monday, said the trade and business community was in a state of agony due to the imposition of 0.6% withholding tax on all types of banking transactions from non-filers of income tax returns.
He said most of the transactions from July 1 had been shifted to cash mode, which was also affecting the banking system.
KATI Patron-in-chief and Trade Development Authority of Pakistan (TDAP) Chief Executive SM Muneer said the withholding tax had been implemented in Pakistan for the past several years, yet tax authorities had failed to increase the number of return filers as at present they were just around 0.88 million.
This showed that the measures taken in the past had proved counterproductive as the number of return filers further decreased last year, Muneer said, adding the Federal Board of Revenue (FBR) should adopt alternative measures to enhance the number of taxpayers instead of taking steps that discouraged people from becoming registered with the tax authorities.
“Pakistan’s banking system is one of the best and it has been resilient even during the global financial crisis. Such measures will hurt the banking industry, which is contributing immensely to the national revenue collection.”
The KATI president urged the government to avoid undertaking measures that created unnecessary chaos in the system. “Already a tormented city, Karachi cannot afford any further disturbance,” he said.
Published in The Express Tribune, July 7th, 2015.
As the news of imposition of 0.6% withholding tax on banking transactions spread, several organisations and institutions have started voicing their concern over the levy.
The latest organisation adding its voice to the chorus is the Korangi Association of Trade and Industry (KATI), which has urged the government to withdraw the tax on banking transactions as it is hampering daily business activities.
KATI President Rashid Ahmed Siddiqui, in a statement on Monday, said the trade and business community was in a state of agony due to the imposition of 0.6% withholding tax on all types of banking transactions from non-filers of income tax returns.
He said most of the transactions from July 1 had been shifted to cash mode, which was also affecting the banking system.
KATI Patron-in-chief and Trade Development Authority of Pakistan (TDAP) Chief Executive SM Muneer said the withholding tax had been implemented in Pakistan for the past several years, yet tax authorities had failed to increase the number of return filers as at present they were just around 0.88 million.
This showed that the measures taken in the past had proved counterproductive as the number of return filers further decreased last year, Muneer said, adding the Federal Board of Revenue (FBR) should adopt alternative measures to enhance the number of taxpayers instead of taking steps that discouraged people from becoming registered with the tax authorities.
“Pakistan’s banking system is one of the best and it has been resilient even during the global financial crisis. Such measures will hurt the banking industry, which is contributing immensely to the national revenue collection.”
The KATI president urged the government to avoid undertaking measures that created unnecessary chaos in the system. “Already a tormented city, Karachi cannot afford any further disturbance,” he said.
Published in The Express Tribune, July 7th, 2015.