ISLAMABAD: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) President Mian Nasser Hyatt Maggo has written a letter to Prime Minister Imran Khan and Finance Minister Shaukat Tarin, urging them to repeal the Section 203A of the Finance Bill 21-22.
According to the FPCCI, Section 203A gives powers to arrest and prosecute any person for concealment of income to assistant commissioners of Inland Revenue Service merely on the basis of an accusation or doubt. Section 203A opens doors to harassment of business, industry, and trade community, he added.
FPCCI SLAMS SECTION 203A:
The FPCCI president said that Section 203A will add to the already existing harassment of the business community by tax officials through the issuance of several thousand notices of which Finance Minister Shaukat Tarin has taken notice and his timely intervention has resulted in the withdrawal of a big number of notices issued to the businessmen.
Mian Nasser said that businessmen must be respected for generating taxes and employment for the country. The business should be conducted in harmony instead of conflicts and contradictions created by the tax officials by giving them discretionary powers, he continued.
He said that Section 192A (Prosecution for Concealment of Income) of the Income Tax Ordinance, 2001, already covers the subject sufficiently. There is no need for Section 203A and the FPCCI demands it should be omitted and taken off the table in the final budget documents.
‘ANAMOLIES’ IN BUDGET AS PER FPCCI LETTER:
Secondly, in the newly announced finance bill 2021-22, in clause 28, a new amendment has been proposed against sub-serial (ii) of serial (1) of sub-section (1) of Section 156 of the Custom Act 1969 regarding the placement of invoice and packing list inside the containers of imported goods.
“We would like to identify that the business community has severe reservations against the harsh penalties being imposed in the case of non-compliance of the said provision. Penalties have been increased up to Rs1,000,000 besides blocking of WEBOC User IDs and confiscation of goods, which is completely unjustifiable,” the letter added.
“Other than finished goods, various commodities, raw materials, and intermediary goods are imported in large volumes; which makes it impractical to place the invoice on the goods,” it added.
“On the other hand, in case of multinational organisations, the beneficiary is in one country and the actual shipper may be in a different country — in such cases the placement of invoice is impractical,” it added.
“This recommended proposal will provide new avenues of corruption to counter the penalties being imposed and will not stop the menace of under-invoicing. Hence, it should be withdrawn and the existing system of penalties should be continued.”
“Furthermore, another sub-serial (iii) relates to the punitive penalties being imposed, if any person fails to upload mandatory documents required under section 79 or 131 of the customs Act 1969. The penalty being imposed can go up to Rs 250,000/- adding substantial cost to the business upon unavailability of documents and will cause delay in filing of goods declarations and subsequent clearance.”
According to the letter, “Several documents are already attached upon filing of goods declaration to make the assessment easier for the customs officer. The nature of documents can be different for each item being imported and cannot be specific.”
“On the other hand, the customs officer has the option to call documents through the customs computerized system during the clearance process. Hence imposition of penalty is completely unjustifiable,” it added.
“Several members of the business community have strictly urged that requirement of Master bill of lading – proposed in (kka) sub-serial (b) of serial (1) of clause 2 of Finance Bill, should not be mandatory, and, must be withdrawn because Master Bill of Lading is an unnecessary document that is not even required by banks and also not sent by the supplier.”
“Fulfilling this requirement would not be possible by the traders because once the House Bill of Lading is issued the need for MBL is not required and is an internal document between the forwarder and the shipping line.”
“It should be noted that the shipment manifest is electronically uploaded by shipping lines before the vessel reaches the port and can also be seen by the customs officers through WEBOC; hence making this requirement redundant.”
“The above-mentioned two proposed amendments in the finance bill are unjust and reflect the lack of understanding of ground realities by FBR. I, therefore, request that these amendments should be withdrawn immediately in the larger interest of the country and its economy,” the letter by the FPCCI chief claimed.
