‘Issuance, payment of promissory notes expected next month’

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  • FBR chairman says the system will take its own course if people fail to fulfill their tax obligations

FAISALABAD: Federal Board of Revenue (FBR) Chairman Mohammad Jahanzeb Khan has said that the process of issuance and payment of promissory notes is expected to start during the next month.

Addressing a ceremony in the Faisalabad Chamber of Commerce and Industry (FCCI) on Saturday, Jahanzeb Khan said that earlier, a cut date of February 15 was given to issue the promissory notes but the State Bank of Pakistan and the Ministry of Finance raised some irritants in this regard.

He said that a fair system was being evolved under which the promissory notes would be issued to those exporters who would opt for it.

“Cash payment will also continue side by side,” he assured, adding that one-third payment of the total refund claim would be made in cash while the remaining would be settled through promissory notes.

“Ten per cent markup will be allowed on these promissory notes, which will be paid after three years,” he informed. “These promissory notes will also be accepted as a valid trading instrument in the financial market.”

The FBR chairman urged the general public to pay regular taxes, as “the system would take its own course if they fail to fulfill their mandatory obligations”.

Regarding 40-B, he said that the people involved in under-reporting were on the FBR’s radar and would not be allowed to conceal their actual tax liability. However, he offered to declare Faisalabad “40-B free” if it helps the board in achieving certain revenue targets. He urged the FCCI to play its role as a guarantor in this regard.

The FBR chief further said that 40-B was implemented in another city where a visible improvement of 70pc was recorded.

Regarding distortion in the working of provincial revenue authorities (PRA) and FBR, Jehanzeb Khan said that the sales tax laws, in particular, are not fully harmonized.

“The National Finance Commission (NFC) has established a working ground which is reviewing different proposal to resolve the issue,” he stated, adding that FCCI, as well as other business chambers, should also present viable proposals in this regard.

The FBR chairman said that the tax system had some inherent complications and “we have to sit together to resolve the same”. In this connection, he said that a commissioner level female officer has been nominated as a focal person at the FBR.

He said that the business community, through their relevant chambers, could approach her to get their genuine problems resolved.

“The said focal person will also help in the efficient follow up of the decisions taken during the meetings between the business community and the FBR chairman,” he added.

Jahanzeb Khan noted that traders were an integral part of the economy and in order to address the country’s financial constraints, they have to be brought into the tax net.

“A simple and easy tax system is being evolved for the small traders which will be implemented initially in Islamabad,” he said, asking the FCCI president to submit a proposal to further fine tune the system.

On trust deficit between taxpayers and tax collectors, he stressed the use of technology along with a change in the mindset.

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