September 28, 2020

Chambers & Associations Support Government’s Documentation Effort

There has been a lot of tension between the government and the business community in recent days, due to the new business-related taxation policies of the government. Two of the most impactful of these policies are the imposition of 17% sales tax and the CNIC based invoicing.

Following the first day of a nationwide shutter down strike by the traders, many of the industrialist’s associations showed their concerns. Associations supported the government’s effort to document the economy but argued that the government has imposed too many policies all at once and it is extremely hard for the businesspersons to comply with every single one of the new policies and that too all at once.

The All Pakistan Textile Mills Associating (APTMA) said in their statement that the textile industry has come to a halt. One official said that our stocks are piling up as the traders have refused to buy from us. Officials further said that almost 20 mills have shut down already and others are either partially shut or, are operating at lower capacities. They sad that they support the government’s efforts but the method adopted by the government for imposition of these policies is not ideal. They requested the government to reduce the sales tax ratio to 7.5%.

The FPCCI, in a joint statement with APEX, said that the government should negotiate with the traders regarding their concerns. They said that they support the documentation of the economy but the traders have serious concerns about the government’s policies, which need to be addressed accordingly.

The Karachi Chamber of Commerce and Industry (KCCI) said in their statement that the government is trying to solve all the problems at once, without the input of the businessperson. He said that they do support the government’s efforts but the government needs to take a softer approach towards solving the issues. They further said that the FBR officials have been given more powers and traders are concerned that these officials will use their powers to harass them.

Similarly, the Chambers of Commerce and Industry of Lahore, Faisalabad, and Sialkot all expressed their concerns regarding the policies. They said that they are supporting the government regarding their efforts but the government needs to understand that such high ratios of taxes are not acceptable.

The associations have commended the government’s steps to reduce the turnover tax from 1.5% to 0.2% -0.3% and withholding tax reduction to 1%, but the business community has requested for the reduction of sales tax of 17%, which the government is not ready to compromise on.

Add comment