ISLAMABAD : Islamabad Chamber of Commerce and Industry (ICCI) President Mohammad Ahmed Waheed has called upon the Federal Board of Revenue (FBR) to allow the business community to adjust their payable taxes against their refund claims to facilitate them in overcoming liquidity issues and promoting business activities.

He said billions of rupees of the business community were held up with the FBR in the form of refund claims of sales tax, income tax and duty drawbacks.“It would be a win-win arrangement, both for the government and for the business community,” Mr Waheed said, adding: “It will address the liquidity issues of businessmen and save the funds allocated by the government for payment of the refunds.”

He said allowing adjustment of payable taxes against refunds would also help businesses in improving inventories and promoting exports.

Mr Waheed said FBR was reportedly preparing to start the payment of income tax refunds directly to the bank accounts of those taxpayers who had provided their IBAN, which was appreciable as these refunds were held up with FBR since 2014.

“However, allowing businesses to adjust their payable taxes against these refunds would be a win-win situation for both the sides,” he added.

The ICCI president said the finance division had reportedly released Rs10bn to the FBR for payment of income tax refunds while FBR was issuing cumulative refunds of up to Rs5m.

He said under the prime minister’s relief package, an amount of Rs100bn was allocated for the payment of refund claims under sales tax, income tax and duty drawback to reduce the impact of Covid-19 on businesses.

Therefore, FBR should remove the ceiling of paying up to Rs5m as income tax refunds and pay more refunds or allow businessmen the adjustment of their payable taxes against refund claims that would lessen the liquidity issues of the business community and help them come out of the difficult times to revive the business activities.

Published in Dawn, June 9th, 2020