ISLAMABAD: Talks between tax officials and traders over the issue of banking transaction tax remained inconclusive on Friday, with Finance Minister Ishaq Dar categorically rejecting withdrawal of the levy.
But Dar, who headed the tax team, claimed that significant progress was made on the issue with one group of the traders. The next round of talks will resume on Wednesday.
“We will decide the issue in the next meeting,” Federal Board of Revenue (FBR) Chairman Tariq Bajwa told Dawn after the meeting.
The talks produced no results as the group headed by All Pakistan Anjuman-e-Tajran (APAT) President Khalid Pervez walked out of the meeting, complained a tax official. “We will meet again on Wednesday when all groups participate. The talks cannot reach any conclusion until all traders agree,” he said.
APAT’s Khalid Pervez Group briefed the media about their concerns at a time when the other group was in negotiations with the finance minister at the FBR House.
Pervez announced that his group has decided not to participate in the dialogue on withholding tax with the FBR authorities at this juncture. He, however, did mention the intention to hold internal meeting of traders on Wednesday in Quetta to chalk out future course of action.
He confirmed that the government has categorically conveyed that the withholding tax cannot be abolished as the tax authorities have held out an assurance to the International Monetary Fund and World Bank that the levy will not be withdrawn as it has potential to generate high revenue.
The government did offer to reduce the withholding tax rates to 0.2 per cent, or 0.1pc from the existing 0.3pc, but the group held its position and demanded its withdrawal. “Withholding tax law in Pakistan is a black law,” the trader said.
Pervez also blamed the Chief Minister Punjab Shahbaz Sharif for leaving traders at the mercy of the FBR.
Traders from Lahore have reportedly threatened the government to vote against PML-N candidate in by-election on NA-122 constituency on Oct 11 (tomorrow) in case the tax was not withdrawn. But the finance minister has shown no leniency on the issue.
According to the tax official, traders have some genuine problems like filing of income tax returns and declaration of capital which might lead to higher turnover tax.
Shahid Husain Asad, official spokesman for the FBR, told Dawn that the committees constituted in August were revived again to review the demands of the traders’ community. “We are ready to address genuine grievances of the trading community,” he said.
Responding to a question on amnesty scheme for traders, he said no such thing has been discussed so far.