No more raids on business premises: FBR chief

• Dr Jehanzaib Khan says he will visit Karachi every month for two days in order to coordinate and interact with the business community

KARACHI: There will be no more raids on business premises and the show cause notices already issued in this regard will be withdrawn, said Federal Board of Revenue (FBR) Chairman Dr Jehanzaib Khan while addressing at a business gathering at the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Saturday.

He stated that in order to coordinate and interact with the business community, he would visit Karachi every month for two days.

“To identify new taxpayers, the revenue department is using the (NADRA) data of those non-filers who made frequent foreign visits, purchased luxury cars and payed hefty education fee of their children,” the FBR chief said. “The present tax to GDP ratio (11.2pc) is not sufficient to make Pakistan a prosperous and welfare state.”

Dr Jehanzaib Khan, who was accompanied by an FBR team, announced to formulate a joint committee of FBR officials and FPCCI members in order to facilitate the business community in resolving their long outstanding and day-to-day issues.

He also announced a focal person in FBR to coordinate with him and the FPCCI and to take stock of issues and problems pertaining to trade and industry which may arise due to misuse of discretionary powers by FBR officials.

He disclosed that two-thirds of the sales tax refunds would be paid through promissory notes while the rest would be paid through cash refunds system. “Payment of total refunds in one go would create revenue shortfall.”

The FBR chairman said that those who have filed their income tax return after due date would be accommodated as filers, adding that the tax policy is being prepared with an aim to ensure transparency in FBR’s workings and to raise awareness among the taxpayer about their rights.

In his welcome address, FPCCI President Engr Daroo Khan Achakzai highlighted the precarious economic situation of the country, saying that Pakistan is passing through a transitory period and radical revolutionary reforms are being introduced in all sectors to uplift the economy.

He said that the government’s efforts regarding curtailment of imports through imposition of regulatory duties have badly impacted the imports as well as revenue collection. He urged the government to revert back to the previous system of levying penalty on a daily basis instead of declaring late filers as non-filers and excluding them from the active taxpayers’ list.

FPCCI Senior Vice President Dr Ikhtair Baig on the occasion proposed various measures to increase the tax net and suggested to activate ‘alternative dispute resolution committees’ to realize Rs38 billion in taxes lying pending in various courts of law.

The FPCCI SVP urged the FBR to encourage direct taxation system instead of indirect taxes which is “regressive in nature and is the main cause behind increasing inequality”.

The meeting was attended by FPCCI Vice Presidents Muslim Muhammedi and Arshad Jamal, former FPCCI president Zubair Tufail Former, Advisor to President and former FPCCI SVP Syed Mazhar Nasir and former FPCCI SVP Khalid Tawab.

During the question and answer session, the FBR chairman replied to various queries raised by leading businessmen and representative of trade associations.