KARACHI: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has asked the Federal Board of Revenue (FBR) to cut discretionary powers of inland revenue officers and simplify taxation laws if it wants to increase collection.
The apex trade body in a statement issued on Saturday stated that for increasing compliance the tax authorities have to restore taxpayers’ confidence by discouraging the misuse of discretionary powers of these officials.
It observed that apart from the diminishing confidence of taxpayers in the revenue body, the current monitoring practices of tax officials are also the reason for the increasing size of informal economy.
The federation further elaborated that although a return filed within the time limit does qualify for Universal Self-Assessment Scheme, still businesses are put through multiple tax assessments.
The FPCCI suggested that the authority to select such returns of income tax should exclusively rest with the FBR through electronic selection, as the board selects the audit cases randomly through computer balloting under Section 214C of the Income Tax Ordinance.
The apex body strongly criticised the posting of inland revenue officers within business premises under Section 40B of Sales Tax Act, 1990, to monitor production, sales of goods, stock position etc as not only out-dated, but also causing hurdles in production and tantamount to harassment.
The federation said that this monitoring could also be carried out electronically, as is the practice all over the world.
Published in Dawn, March 18th, 2018