ISLAMABAD, May 4: Speakers at a pre-budget seminar here on Wednesday proposed scaling down of the existing rates of duties and taxes in the forthcoming budget along with a host of measures for bringing potential taxpayers in the tax net. The seminar was organized by the Institute of Chartered Accountants of Pakistan (ICAP). The session was headed by Chairman Central Board of Revenue (CBR) M. Abdullah Yousuf.

Speaking on the occasion, former president of the Islamabad Chamber of Commerce and Industry Mohsin Khalid proposed that the government should reduce the maximum customs duty to 20 per cent from 25 per cent.

He also proposed import of plant and machinery at zero per cent duty and said corporate tax rates should be brought down to encourage corporatization.

ICAP representative Khalid Majid said there was a need to increase the tax base in the country. He said only 1.1 million taxpayers had filed tax returns this year. Out of the 45,000 registered companies, he added, only 12,000 filed returns. Similarly, out of 88,000 companies and individuals registered with the sales tax department, 20,000 did not file any return.

He proposed introduction of common identifying number for documentation of the economy to increase revenue through broadening of the tax base. Regardless of the location or area of residency or office, a unique national tax number should be devised to match with the number on the national identity card and sales tax registration, he said.

Mr Majid also proposed that cooperative societies engaged in real estate should be brought at par with companies. He said rate of tax for non-corporate entities like association of persons should be brought down to 30 per cent and withholding tax on imports, exports, supplies and payments to contractors also be reduced.

Syed Shabbar Zaidi proposed that special tax at a rate of 20 per cent for small and medium taxpayers should be considered in the budget. He proposed abolition of inter-corporate dividends, gradual phasing out of presumptive tax regime, reduction in withholding tax rates on import to 2 per cent, supplies to 1.5 per cent, expansion of zero-based sales tax regime to export- oriented industries, especially the textiles sector and abolition of exemption from tax on unexplained foreign exchange remittance.