Tanners concerned on expected rise in WHTMay 21, 2013
Lahore: Pakistan Tanners Association (Central) has expressed concern over expected rise in withholding taxes. In a release here Tuesday, the Federal Bureau of Revenue (FBR) has once again moved a proposal to the Ministry of Finance that withholding taxes rates may be enhanced in coming budget. FBR has proposed increase in WHT of Commercial imports from 5% to 6%, for export sector from 1% to 1.5% and Non-Corporate exporter 1% to 2%, on contracts of Non-Corporate from 6% to 7%, on supplies of Corporate Sector 3.5% to 4%, on cash withdrawal of Corporate Sector 0.20% to 0.30% for Non-Corporate 0.4%.
FBR has not taken stakeholders into confidence and instead of widening tax net they have adopted traditional way to squeeze those who already pay taxes.
Agha Saidain Chairman Pakistan Tanners Association (Central) said any move to add taxes to export sector would be blunder and detrimental to our economy. FBR must realize that due to the energy crisis, impact of war on terror, law & order situation our cost of doing business is highest in the region. Pakistan is losing its ground and competitiveness against regional countries, China, India, Bangladesh, and Sri-Lanka.
Export Sector must be facilitated to earn foreign exchange for the Country and it should not be used for revenue collection as is done all over the world. For FBR it is easy to collect revenue from export sector in shape of WHT but it can be done without any increase in this WHT. FBR may bring export friendly policies and export targets may be fixed at higher side.
With increased exports they can raise revenue through previous rate of WHT and Country will get Foreign Exchange and people will get employment.
Agha said any increase in WHT of Export Sector would be extremely short sighted and damaging to our exports.