20000205

PTA proposes

ST rate at 7 pc

RECORDER REPORT

KARACHI: The Pakistan Tanners Association (PTA) has proposed that the sales tax rate be reduced across the board to seven percent and all fiscal exemptions be withdrawn in the next budget for 2000-2001.

In its pre budget proposals submitted to the Ministry of Finance, PTA suggested that if the sales tax rate was reduced to seven percent the government would not lose any revenue as the loss would be recouped by withdrawal of all tax exemptions.

The PTA proposed that withholding tax on export of leather made-ups be reduced from 0.50 percent to 0.25 percent and from 0.75 percent to 0.50 percent on leather exports which would greatly help to boost exports.

It has further demanded that withholding tax at the rate of one percent on supply of hides and skins be withdrawn.

It is proposed that the export development surcharge being charged on all export consignments at the rate of 0.25 percent be abolished as more than sufficient funds had been accumulated in the account.

Other proposals are:

Ñ withdrawal of all discretionary powers of the income tax commissioners and officers. In cases where income had been declared on local sales, G.P. rate should not be increased at the discretion of the income tax officers not taking into account the past history of the assessee. Once income tax has been paid, there is no justification for imposing penalties, additional taxes and fines for late payment or minor omission.

Ñ The income tax exemption certificates on imports be issued to the exporters for one year. The expiry of exemption certificates resulted in delay of clearance of raw material by customs which led to stoppage of export production.

Ñ The Gold and Silver cards scheme which allowed quick refund of sales tax and customs rebate should be introduced for refund of income tax also for exemption from payment of taxes at import stages. That is holders of Gold/Silver cards be exempted from payment of withholding tax at import stage.

Ñ wealth tax should be immediately abolished as has been promised several times by the concerned authorities.

Ñ incentives such as VIP facilities be given to the manufacturers and exporters who were achieving export target of Rs. 250 million annually.