KARACHI: The Over­seas Investors Chamber of Commerce and Industry (OICCI) has asked the Sindh government to tax actual agriculture income, and also reduce sales tax rate from 13 to 10 per cent over the next three years for registered entities.

The OICCI, a representative body of foreign investors, in its taxation propo­sals for the Sindh budget 2017-18 also urged the provincial government to cut sales tax on telephone usage and bring it on a par with GST rate on services.

While appreciating the provincial government over reduction in sales tax the president OICCI Khalid Mansoor said, “The OICCI members highly appreciate the action of the Sindh government for reducing the rates of sales tax on services, from 15pc to 13pc in last two years.”

He noted that it was highly encouraging that despite cut in sales tax rate the Sindh Revenue Board (SRB) managed to collect more tax on services by 21pc in the first six months of 2016-17.

However, he urged the provincial government to zero rate exports and services of pharmaceutical industry and proposed to remove stamp duty on purchase of orders as it is a tax on ‘instrument’ and not on a transaction.

The OICCI taxation proposals for Sindh also stressed upon the need for a better coordination between all sales tax authorities of provinces and with Federal Board of Revenue (FBR).

They should also have a uniform definition of taxation of services and jurisdiction be agreed to facilitate the taxpayers. Since both life insurance and health insurance, which do not fall within the scope of definition of service, should be exempted from the category of services as was the case in Punjab province.

The foreign investors’ chamber also wanted the federal and provincial governments to immediately address the issue of jurisdiction of Workers Welfare Fund/Workers’ Profit Parti­cipation Fund and give clarity to taxpayers.

Published in Dawn, April 11th, 2017