Revamped valuation process to follow intl. market-based concept: Chairman FBR

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Chairman Federal Board of Revenue (FBR) Asim Ahmed has said that the entire process of valuation was being revamped which will be following the international market-based concept and the relevant law, in this regard, has already been amended. Several international publications were regularly posting prices of different types yarns from several origins/ countries which will be electronically linked with the revamped Valuation System wherein valuations will be regularly according to current international yarn prices, he added while speaking at a meeting during his visit to the Karachi Chamber of Commerce & Industry on Saturday.

Chairman Businessmen Group Zubair Motiwala, Vice Chairman BMG Jawed Bilwani, President KCCI Muhammed Tariq Yousuf, Senior Vice President Touseef Ahmed, Vice President Muhammad Haris Agar, Former Presidents Younus Muhammad Bashir, Iftikhar Ahmed Vohra and Muhammad Idrees, Former President Vice President Muhammad Ibrahim Kasumbi, President Site Association of Industry Riaz Uddin, Member Customs-Operations FBR Mukarram Jha Ansari, Chief Commissioner Dr. Aftab Imam and KCCI Managing Committee along with Senior FBR Officials were also present at the meeting. 

Chairman FBR, while referring to concerns expressed over unnecessary/illegal raids, assured to discuss the issue with DG Customs Intelligence and advised the members of business community to bring all such cases of unjustified raids to FBR’s notice so that action could accordingly be taken. A circular was also issued on 19th October wherein all FBR Field Formations have strictly been advised not to conduct raids

Commenting on issues emerging due to exemptions on import of black tea for FATA, PATA and Azad Kashmir, Asim Ahmed agreed that the exemptions were being misused but these exemptions will be ending on June 30, 2023. FBR devised a mechanism last year wherein, quota was fixed for these areas according to their production capacity. “It is now the stakeholders who should tell the FBR whether the situation has improved or not.” In response, the relevant importers informed that it was the other way around as imports have risen in these areas.

Touching upon the issue of placement of invoice and packing list in containers of import cargo, Chairman FBR, while totally agreeing to Chairman BMG’s remarks, stated that FBR was well aware of this issue and has carried out an extensive exercise to understand it in light of global practices and found business community’s concerns valid therefore, the FBR was looking into to the possibility of withdrawing this condition.

He further mentioned that withholding tax on inward remittances of indenters’ commission has been reduced from 5 percent to 1 percent in this year’s budget while the 13 percent Sales Tax being paid to the provincial exchequer will be discussed with Sindh Revenue Board.

He said that some delays in release of refund claims was occurring but a tranche has recently been released on 2nd November. The business community should carefully submit refund claims as many refund claims get delayed if marked deferred by the system. “FASTER system has been working smoothly yet if anyone faces delays in receiving refunds, they can seek assistance from FBR”, he added.

He also advised all the Chief Commissioners to maintain complete coordination and liaison with the Karachi Chamber so that the grievances being faced by the business community in getting their taxation issues resolved could be minimized. He also promised to resolve the issues being faced by yarn trader period who are not allowed to claim refunds before 14 months while the 7.5 percent difference in duties/ taxes between the commercial and industrial importers of polyester yarn will also be reduced.

Chairman BMG Zubair Motiwala, in his remarks, highly appreciated the present team of FBR for its extraordinary efforts in dealing with the FATF issue that resulted in Pakistan’s exit from the grey list. He said, “Things are moving in the positive direction as far as FBR is concerned but there are some issues which have remained chronic since so many years and these were not being addressed by the FBR. All these issues, which are hardly 4 to 5 in numbers, having no major impact on revenue should be resolved at the earliest so that the businesses as well as the economy starts performing.”

He said that the Chapter 84 and 85 have brought the entire work to a complete halt and it was a matter of grave concerns that around 7,000 applications were in KCCI’s possession which have been lying pending only due to delays in approval from the State Bank of Pakistan. Stopping imports of essential raw materials, spare parts and even solar panels was not making any sense which have to be allowed so that the industrial wheels keep on spinning without any interruption.

Zubair Motiwala was of the view that around US$3 to US$4 billion remain parked abroad which people simply don’t want to remit to Pakistan because of the exorbitant taxes on indenting commission hence, these taxes should be waived so that the desperately needed foreign reserves could be brought to Pakistan.

Appreciating FBR’s move to revamp the valuation system, Zubair Motiwala advised to expedite the process with a view to provide some relief to the business community. “As the country faces severe energy crises, the import of solar panels has to be allowed without any hindrances which would be a great service to this nation”, he said, adding that around 650 vehicles which have already been imported and were lying at the ports must also be cleared by lowering the recently imposed 100 percent extra duty at the earliest.

On the occasion, Vice Chairman BMG Jawed Bilwani stated that the FASTER system for refund claims was working absolutely fine after its launch but the business community has now been facing a lot of issues in getting their refund claims issued on time which often creates liquidity problem and needs to be addressed. “As per law, all refund claims must be processed within 72 hours so that the business community could not face any liquidity issues.”

President KCCI Tariq Yousuf, while welcoming Chairman FBR, pointed out that Karachi’s share in GDP was around $165 billion, which was 43 percent of Pakistan’s national economic size & was projected to hit $193 billion in 2025. “Karachi’s role in Pakistan’s economic growth has been phenomenal & is growing at a tremendous pace. However, the ongoing economic issues, high cost of doing business & taxation matters have been affecting the productive capacity of the private sector whose competitiveness has been deteriorating”, he added.

He was of the view that the high amount of tax cost for businesses, particularly the SMEs should be a matter of great concern for policymakers as this has been affecting Pakistan’s growth potential.

While appreciating Chairman BMG Zubair Motiwala for his remarkable job as Chairman of the Anomaly Committee for Business, he said that out of various recommendations agreed by the then finance minister and Chairman FBR along with his team, many issues were still pending which need to urgently resolved with a view to create an enabling environment for sustainable economic growth.


 

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