KARACHI: Federal Board of Revenue (FBR) chairman Shabbar Zaidi on Saturday said there was no ambiguity in the tax amnesty scheme and that no changes would be made in the Finance Bill in this regard.
Addressing members of the Karachi Chamber of Commerce and Industry (KCCI), he said the tax amnesty scheme would be made part of the Finance Bill for its formal approval by parliament and it would be the same as had been promulgated through the presidential ordinance.
Mr Zaidi said he had issued orders for “no raids” on business premises so there was no need for the business community to be afraid of arrests.
While agreeing with the business community that there should be no withholding tax on import of raw materials, he asked the businesspeople to provide before the announcement of the budget 2019-20 a list of raw materials for reducing tax rates at the import stage. The rate of withholding tax on imported raw materials hovers three per cent to 6pc.
On smuggling of goods, he said that Afghan Transit Trade was used for an influx of illegal goods in Pakistan while there were other illegal routes as well to dump such goods in the country. The business community should take a firm stand to discontinue sale of smuggled goods during Ramazan, he added.
The FBR chairman said the government was trying hard to curb smuggling but traders should also play their part to stop this practice as smuggled goods were openly selling in markets.
“If the business community and traders assure and support me for not holding any protest then I can issue orders for conducting raids in the markets for illegal goods from tomorrow,” he said, adding there was a need for long-term reforms in the taxation system.
Mr Zaidi said he was collecting data of shops and industrial units in Sindh and Punjab which he would share with Prime Minister Imran Khan. He was of the view that around 700,000 units were operating in Punjab. He said he did not have any data regarding shops and industrial units in Sindh.
According to one senior member of the business community who was present at the meeting, Mr Zaidi had a simple message for those assembled before him. “I’m from the private sector, I know all of you, I know your business, you cannot fool me, start paying your taxes,” he said.
The business community expressed concern that June 30 was too short a deadline for the amnesty scheme and asked Mr Zaidi to extend it. “He said make the declaration by then, but pay later,” the business leader quoted him as saying.
Mr Zaidi also clarified that the scheme is for benami bank accounts only, not immoveable assets. He claimed that 30pc of all bank accounts were benami. “We want to bring them into the mainstream,” he is reported to have told the gathering.
Mr Zaidi assured the business community that there would be a maximum of two audits in a year. Primarily there should be only one audit per year, and even that only when selected.
“We want revival of confidence in the FBR,” the businessmen told him. “I will give you the trust, and you will get this confidence,” he is reported to have replied, but laid emphasis on proper declarations in tax returns.
Published in Dawn, May 19th, 2019