KARACHI: The Overseas Investors Chamber of Commerce and Industry (OICCI) submitted taxation proposals for the upcoming 2017-18 Punjab budget representing the collective recommendations of foreign investors.
Commenting on the OICCI Punjab Province Taxation Proposals, OICCI President Khalid Mansoor said, “OICCI Members commend the initiative being taken by the Punjab Government and Punjab Revenue Authority in broadening the reach of its coverage to 45000 registered taxpayers and its active engagement in building a conducive private-public partnership among key stakeholders”. It is desirable, President OICCI further said “that the Punjab Government give serious consideration to our taxation proposals which eventually will be a win-win for the province, the country, and the tax payers”.
The OICCI’s specific recommendations for inclusion in 2017-18 Punjab Budget include, Punjab sales tax rates which are 16% on services and which should be reduced in the 2017 budget to be at parity with Sindh sales tax rate of 13%. Then gradually reduced to 10% over the next three years. Agricultural Income should be taxed on actual, and not notional income, including rent income of absentee landlords. This has also been the OICCI recommendation for other provinces in Pakistan as well. Telephone usage sales tax rate of 19.5% percentshould be made equivalent to GST rate on services while the Input Adjustment on Franchise Fee should be allowed to manufacturers. It is already allowed in other provinces. Input tax paid by the pharmaceutical industry and export of services by registered individuals should be zero-rated.
The OICCI Taxation Proposals for Punjab also include recommendations for better co-ordination between all Sales Tax authorities in Punjab, Sindh, KPK and Balochistan. Additionally, a uniform definition of taxation of services and jurisdiction should be agreed with the FBR to facilitate taxpayers, and input of sales tax should be allowed as whole and not for assets exclusively used in a province. Furthermore, Federal and Provincial Governments should urgently address the issue of the jurisdiction of WWF/WPPF and provide clarity to the taxpayers.
