ISLAMABAD: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has requested the government to hold the Tax Laws (Third Amendment) Ordinance 2021, containing budgetary measures, in abeyance, as harsh legislation will destroy the economy, “irreversibly”.
On Monday, Mian Nasser Hyatt Maggo, president FPCCI, termed the new ordinance “a conspiracy against the government” and conflicting Finance Minister Shaukat Tarin’s vision of due consultations with all the stakeholders before announcing any taxation measures.
He also expressed his fears that this may lead to agitation for being “grossly unfair”.
In a statement issued here on Monday, Maggo condemned the “human rights’ defying sweeping powers” to the Federal Board of Revenue (FBR) and enabling it to disconnect mobile phone, electricity, and gas connections of the non-filers of income tax returns. It also empowers the NAB to open income tax cases as old as 20 years through accessing tax records through the NADRA, he added. The new amendment is called, “The Tax Laws (Third Amendment) Ordinance 2021.”
Maggo added that it was the FPCCI’s proposal to disconnect the connections of commercial and industrial non-filers; but, this ordinance does not take due and fair procedure of separation of executive and adjudication into account. The ordinance vaguely mentions under-assessed income tax filers and provides blanket discretionary powers to the income tax officers, he added.
Pointing out the challenges posed by mandatory online and digital payments, the FPCCI chief said that our economy runs on the sales made on post-dated cheques and credit is usually for two months and the businesses cannot comply with this condition in the new ordinance.
The FPCCI chief maintained that the ordinance contains budgetary measures and these cannot be taken without due consultation with the stakeholders and the ordinance has already come into force from September 15, 2021. The FPCCI considers this “anti-business and unfair”. Khawaja Shahzeb Akram, SVP FPCCI, pointed out the “conspicuous excesses” being permitted to the FBR under the amendment; and, observed that it will only open the door to “even more corruption” in the taxation system and result in an overwhelming increase in harassment of the business community.
The FPCCI deputy chief added that in the rest of the world, the governments are giving tax breaks and incentives to the SMEs to ward off the losses caused by the Covid-19; and, in Pakistan, the government is trying to reinvent the wheel and strangulate the business, industry and trade community of Pakistan.
Haji Ghulam Ali, a former president of the FPCCI and a former senator as well, expressed his shock over the amendment and its potential to be misused against opponents. He said that the National Accountability Bureau (NAB) and the FBR have “already created enough fearful and discouraging environment” that adding a further “harsh piece” of legislation will “destroy the economy irreversibly”.
He added that reopening the dead income tax cases of up to 20 years will not bring any more revenue in the government’s kitty. The FPCCI categorically demands to hold the ordinance in abeyance; until and unless all the stakeholders are consulted.
The FPCCI remains committed and available for dialogue and discussion for reforms in the taxation system and broadening of the tax base. The FPCCI reiterates that the taxation system can only be effectively reformed, if all the stakeholders are taken onboard.