Pakistan Chemicals and Dyes Merchants Association criticize Federal Board of Revenue for changes in Sales Tax with Holding regime
Karachi, February 19, 2013 (PPI-OT): The Chairman PCDMA Salim Vali Mohammed has severely criticized the unlilateral decision of FBR to bring about unwarranted and harsh changes in the Sales Tax With Holding regime without consulting stake holders.
Not only the rate of Sales Tax withheld is increased from 1% to 1/5th of the applicable Sales Tax rate (which effectively comes to 3.2%), but also all the companies and exporters (regardless of the status whether individual or AOP) had been made Sales Tax With-holding agent.
These changes shall not add any revenue to government exchequer as it proposes to increase the amount withheld from registered person, just adding to their financial woes. The confidence of business community is already at its lowest ebb due to worsening law and order situation in Karachi and the energy crisis. This SRO shall further add to their agony as it will create hardship both for the manufacturing sector and exporters as well as the commercial importers of industrial raw materials.
Vice Chairman Zubair Riaz said that Commercial importers not only pay the Sales tax amount in advance but are also paying a large amount as Sales tax on account of Value addition in advance at customs stage. Hence, if 3.2% Sales Tax is withheld again then they have no way of adjusting or recovering the same and it shall amount to double taxation of their value addition.
In a letter to Chairman, FBR, the Chairman PCDMA has urged him to immediately withdraw the said controversial SRO 98 (I)/2013 and till the final decision on the said SRO kindly exempt supplies made directly by Commercial importers from the deduction of the Sales Tax by their buyers.
For more information, contact:
Pakistan Chemicals and Dyes Merchants’ Association
Chemical and Dye House, Rambharti Street,
Jodia Bazaar, Karachi-74000
Tel: +9221 32432752, 32439124
Fax: +9221 32430117