By Kazim Alam, The Express Tribune
KARACHI: Management accountants and representatives of the country’s business community on Friday insisted that the Federal Board of Revenue (FBR) should withdraw the multiple rates of sales tax and introduce a single rate across the board.
“The FBR should implement a uniform sales tax of 9% on all products,” said businessman Zakaria Usman while addressing a pre-budget seminar.
The seminar was jointly held by the Karachi Branch Council (KBC) of the Institute of Cost and Management Accountants of Pakistan (ICMAP) and the Federation of Pakistan Chambers of Commerce and Industry (FPCCI).
Usman further said that the reduction in sales tax will not decrease the overall revenue of the government, adding that the reduced volume of smuggled goods would automatically result in the enhanced import of goods through the legal channel.
He also called for a fair taxation policy across all the sectors of the economy. “Why should the manufacturing and services sectors pay all the taxes while the agriculture sector remains largely untaxed?”
Speaking on the occasion, AF Ferguson and Company Director Tax Services Asif Kasbati said the corporate income tax rate should gradually be brought down to 25% and 30% for the listed and unlisted companies, respectively.
Kasbati also proposed that the basic tax exemption limit be enhanced to Rs450,000 because the consistently high inflation during the past decade had rendered the previous tax exemption limit pointless.
To promote the capital market, he recommended that the tax credit for investment in shares be increased from Rs500,000 to Rs700,000 along with restoration of the retention period to one year.
Published in The Express Tribune, April 28, 2012.