KARACHI, June 18: The Karachi Tax Bar Association (KTBA) has taken strong exception to the budget 2013-14 proposal of 0.5 per cent levy on the net movable assets of an individual.

The association said this would mean that the assets generated by an individual out of taxable income would be repeatedly taxed if the funds were kept in the form of securities, investments or cash.

Speaking at a post-budget seminar, KTBA President Haider Ali Patel observed that the budget measure would discourage individuals to save which would be a blow to the economy, which already has the lowest saving ratio in the region.

On the direct tax, he pointed out that proposal to introduce the requirement for the commissioner’s approval in writing for revising the income tax return is unwarranted.

He added that the proposal to change the criterion to allow an Inland Revenue officer with 15 years of service in basic scale of 17 and above who happened to be a law graduate to be appointed as judicial member is totally uncalled for and unjustified.

He said a law degree holder could not be equivalent to a district judge or an advocate of a high court.

Terming the broadening of the tax net as a positive step, he emphasised that effective follow-up and enforcement by the FBR were required.

A speaker at the seminar stated that the Finance Bill 2013 had proposed to enlarge the withholding tax regime, which would not only require government’s will but very effective monitoring by the FBR.

On proposed changes in indirect taxes, another speaker noted that the increase in rate of sales tax by 1pc would have multiplier effect on the economy and the inflation would rise.