LAHORE, May 18 The Lahore Chamber of Commerce and Industry (LCCI) has cautioned the Federal Board of Revenue (FBR) against discontinuation of the Universal Self-Assessment Scheme (USAS).

Criticising the proposal for discontinuation of the scheme from the next financial year in a statement issued here on Monday, chamber president Mian Muzaffar Ali and Excise and Taxation Standing Committee convener Shahzad Azam Khan said the step would open floodgates of corruption and create an atmosphere of distrust between taxpayers and tax officials.

They said the USAS, in vogue for the last eight years, had not only helped in meeting revenue targets but also increased the confidence of taxpayers.

Rolling back of the scheme would disturb the revenue collection on the one hand and result in unnecessary litigation and coercion on the other, they said.

The scheme, they said, had been introduced after holding long discussions with the business community, but surprisingly not a single businessman had been consulted in finalizing the plan to withdraw it.

The USAS introduced in line with World Bank and other donor agencies' policies was one of the most successful schemes ever launched in the country, they said.

Instead of broadening the tax net to increase the revenue collection, they said the FBR was trying to create troubles for tax payers at a time when the economy was facing multiple internal and external pressures because of acute power shortage, high markup rates and global economic meltdown.

They said the current shortfall in revenue collection was not because of the self-assessment scheme but of sharp cut in demand in the international market.

The revenue collection would hopefully even surpass the target as soon as the situation returned to normalcy, they said. The USAS introduced in 2001 had minimised the taxpayer and the tax official interface and had brought a robust growth in voluntary payment of income tax, they said.