ISLAMABAD: Islamabad Chamber of Commerce & Industry (ICCI) has called upon the Federal Board of Revenue (FBR) to allow the business community to adjust its payable taxes against refunds claims that would greatly facilitate traders in overcoming liquidity issues and promoting business activities.
ICCI President Muhammad Ahmed Waheed said that billions of rupees of the business community are held up with FBR in the form of refunds claims of sales tax, income tax and duty drawbacks and allowing adjustment of payable taxes including customs duties and sales tax against refunds claims would be a win-win arrangement, both for the government and for the business community.
“It would address the liquidity issues of businessmen and save the funds of government allocated for payment of refunds,” he said.
He said that allowing adjustment of payable taxes against refunds would also help businesses in improving inventories and promoting exports.
Waheed said that FBR was reportedly preparing to start the payment of income tax refunds directly to the bank accounts of those taxpayers who have provided their IBAN, which was appreciable as these refunds were held up with FBR since 2014.
However, he said that allowing businesses to adjust their payable taxes against these refunds would be a win-win situation for both sides.
The ICCI president said that Finance Division has reportedly released an amount of Rs10 billion to FBR for payment of income tax refunds while FBR was issuing cumulative refunds of up to Rs5 million.
However, he stressed that the Ministry of Finance should release more funds to FBR to clear maximum income tax refunds that would improve the liquidity position of businesses and enable them to play a better role in the economic revival of the country.
He said that under the prime minister’s relief package, an amount of Rs100 billion was allocated for the payment of refund claims under sales tax, income tax and duty drawback to reduce the impact of Covid-19 on businesses.
Therefore, he urged that FBR should remove the ceiling of paying up to Rs5 million as income tax refunds and pay more refunds or allow businessmen adjustment of their payable taxes against refunds claims that would lessen the liquidity issues of the business community and help them come out of the difficult times to revive business activities in the country.
