Tajir Dost Scheme misses revenue target
- FPCCI demands a consultative approach to tax policymaking
- FBR withdraws requirement for CFO affidavits
- Concerns raised over-ambitious revenue collection target
- Finance Bill reduces business confidence
- Tajir Dost Scheme misses revenue target
Karachi: In a significant development, the Federal Board of Revenue (FBR) has agreed to end the harassment of genuine and regular taxpayers, following a meeting with the Federation of Pakistan Chambers of Commerce and Industry (FPCCI). This decision comes after FPCCI President Mr. Atif Ikram Sheikh raised concerns about the excessive scrutiny faced by honest taxpayers.
Mr. Rashid Mahmood Langrial, Chairman of FBR, acknowledged the concerns raised by FPCCI and committed to focusing on tax evaders and defaulters instead. However, he also emphasized the need for all traders and industrialists to file their tax returns accurately and transparently. FPCCI agreed to support FBR’s efforts in this regard, provided that tax collection policies are implemented in a consultative manner.
One of the key demands raised by FPCCI was the withdrawal of the requirement for chief financial officers (CFOs) to sign affidavits. FBR agreed to this request, recognizing that the existing sales tax law already provides sufficient safeguards for responsible tax filing.
FPCCI also expressed concerns about the FBR’s ambitious revenue collection target of PKR 12.97 trillion, which represents a 40% increase year-on-year. Given the slow economic growth rate of 2-3%, this target is seen as challenging and could potentially lead to increased taxation.
The business community has been particularly critical of the Finance Bill, which introduced several changes that reduced their confidence in government policies. FPCCI highlighted the abrupt withdrawal of a 1% full and final liability for exporters and the sales tax exemption on local supplies to registered exporters authorized under the Export Finance Scheme (EFS).
Other issues raised by FPCCI included the implementation of the Tajir Dost Scheme without consultation, the problematic SRO. 350 (I)/2024, and the need to simplify the Export Finance Scheme (EFS). FPCCI also advocated for the effective revival and expansion of Alternate Dispute Resolution Committees (ADRCs) and raised concerns about the inclusion of Export Processing Zones (EPZs) in the regular tax scheme.
FBR Chairman Rashid Mahmood Langrial acknowledged the need for reducing tax rates to enhance compliance but stated that it is not feasible in the current economic circumstances. He expressed optimism about the improving economic indicators and reiterated his commitment to addressing FPCCI’s concerns.
In addition to the above, FPCCI also raised issues related to stuck-up cargo containers at Panjgur and the plight of the cotton ginning sector. FBR agreed to address these matters and provide relief to the affected businesses.