ISLAMABAD: The Institute of Chartered Accountants of Pakistan (ICAP) on Tuesday suggested an audit of textile export subsidies by an international firm to justify export outcomes and called for the withdrawal of all income tax exemptions to remove distortion as a national conviction instead of external demands.
Speaking at a news conference, President ICAP Ashfaq Yousuf Tola opined that textile exports had not increased in terms of quantities but the growth was witnessed on account of increase in unit cost which more than doubled. He suggested that this was ground for an independent audit by an international firm of repute to conclude if a series of subsidies in the shape of tax exemptions and energy discounts were justified on the basis of export outcomes.
Mr Tola, who was accompanied by ICAP members on fiscal laws and economic advisory M Ali Latif and Zeeshan Ijaz, said the government should immediately integrate federal and provincial authorities, link all real estate stakeholders with point of sale (POS), and eliminate tax exemptions as part of the upcoming budget.
He said a Model Federal Budget for 2022-23 had been shared with the finance and revenue authorities. The proposals included that all housing societies, developers, and builders engaged in the selling of plots should integrate their systems with the Federal Board of Revenue (FBR) on the same mechanism as POS integration and share real-time transfer of files and plots.
“The government should seriously consider withdrawal of all discriminatory tax exemptions and concessions provided in the Second Schedule to the ITO 2001” with a national conviction to remove distortions and facilitate tax culture on a proactive basis rather than at the behest of the International Monetary Fund, he said.
Mr Tola advised the government to go for the integration of federal and provincial revenue authorities across the country in such a way that it provides a one-window solution to the taxpayers without undermining the existence and independence of each authority.
Published in Dawn, June 1st, 2022