ISLAMABAD: The government may have settled the issue of new withholding tax on bank transactions of Rs50,000 and above with the big businessmen by halving the tax, but small traders are still haunted by the tax.

“The main issue is that the banks don’t have proper information and data,” Ajmal Baloch, President All Pakistan Traders Action Committee (APTAC), told a press conference here on Monday, alluding to the intricacies of the tax imposed on non-filers of tax.

Not only the FBR was too slow in providing the relevant information to the banks, it also failed, as always, to take stakeholders into confidence, he said announcing that the APTAC is holding a consultative meeting in Lahore on July 24 to take a decision.

“If the majority rejects the new option offered by Finance Minister Ishaq Dar, there will be a protest strike all over the country,” declared Mr Baloch.

“It is all messy because the taxation authority either makes unrealistic commitments to the IMF or frames policies in isolation,” he said.

Traders face problems because banks are in the dark who is a tax filer and who is not. Even after a trader proves he is a filer, it is a problem to get back the excess tax deducted from the FBR, according to him.

After the 0.6 per cent withholding tax imposed on all banking transactions over Rs50,000 for non-filers in the national budget 2015-16 caused a furore in the business community, Finance Minister Ishaq Dar met the Federation of Pakistan Chamber of Commerce and Industry and halved it for non-filers of income tax return for three months, that is up to September, 30, 2015.

It was also decided that the non-filers, even if they fall in the category of non-tax payers, have to file their income tax returns by September 30, 2015 after which the tax rate would be 0.6 percent for all non- filers.

Mr Baloch was flanked by vice president APTAC Balochistan, Faisal Mandokhel and office bearers from Rawalpindi Shahid Ghafoor Paracha and Sheikh Muhammad Hafeez.

They said that the copy of the agreement reached by the FPCCI was forwarded to all chapters of APTAC for review and internal discussion.

Several traders separately complained that the tax filing process was cumbersome and difficult for them to understand.

“They (tax authorities) first impose a policy unthinkingly only to reform it after protests and agitation burst out,” said the traders of Aabpara market. “Now they have started to issue income tax filing forms in Urdu too but they were still difficult to be filed by an ordinary person.”

“It usually costs a filer up to Rs20,000 to get the form filled by a lawyer, which, sometimes, could be higher than the income tax itself,” observed one small trader.

Published in Dawn, July 14th, 2015

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