A senior team of taxmen will brief Prime Minister Nawaz Sharif here on Monday (today) about the three-year plan to phase out exemptions and tax concessions of income tax, sales tax, customs and federal excise duty (FED) granted under a slew of Statutory Regulatory Orders (SROs).
Sources told Business eam of senior tax officials headed by FBR Chairman Tariq Bajwa would give a detailed briefing to Nawaz Sharif at the PM’s House on Monday (today). In this regard, the Ministry of Finance has already analysed the FBR’s plan on the withdrawal of various SROs. The items have been categorised for the withdrawal of exemptions under the phase-wise plan for sales tax, income tax and customs duty and the first phase will be implemented from April 1, 2014.
The committee on concessionary regime under SROs headed by FBR Chairman has already submitted its report to the Ministry of Finance.
The committee on concessionary regime reviewed the SROs, Sixth Schedule of the Sales Tax Act 1990 and Second Schedule of the Income Tax Ordinance 2001 to identify exemptions to be withdrawn in future. The withdrawal of exemptions under the SROs and amendments through Sales Tax Act 1990 and Income Tax Ordinance 2001 would be simultaneously done in a systematic manner, sources added.
Under the three-year plan to phase out exemptions, some exemptions would be taken away in next federal budget (2014-15). The remaining exemptions would be taken away in subsequent two fiscal years. However, the plan would be finalised by December 31, 2013 to withdraw unnecessary sales tax concessions and exemptions.
Sources said the committee has also identified all such SROs that are creating distortions in taxation regime. The committee also reviewed all such SROs for possible withdrawal along with the impact of each of the notification on relevant taxes. The committee finalised the SROs causing revenue loss to the national exchequer and distorting the entire taxation regime.
Sources said the sensitivity of the issue to withdraw exemptions can be gauged from the fact that the matter would be taken up at the highest level of Prime Minister for approval.
Author: Sohail Sarfaraz
Source: Business Recorder