Fixed retail tax clawback: HCCI chief urges minister to withdraw decision – Business & Finance
HYDERABAD: Hyderabad Chamber of Commerce and Industry Chairman Adeel Siddiqui has urged Federal Finance Minister Miftah Ismail to immediately withdraw the decision to recover fixed tax from retailers through invoices electricity from small unregistered traders.
In a statement here on Tuesday, he called such a clawback of small traders a great injustice. He drew the Minister’s attention to the fact that this fixed tax on retailers was intended for unregistered traders, while registered traders paid income and sales taxes each year.
He said the fixed retail sales tax was good planning, but how it was introduced was questionable.
He said taxpaying businessmen warehouses received bills as well as a fixed tax on retailers and this fell under the category of double taxation. He said even closed warehouses and stores were required to pay the tax, which was totally unfair. He said it caused unrest among traders.
Adeel said that this tax appears on June electricity bills as the fiscal year starts from July.
He said that under the 2022-23 federal budget, small merchants would be required to pay this fixed retail tax starting July 1 through their electricity bills each month. He said the reason for this recovery was that commercial electricity consumers. For example, he said that 3,000 rupees would be payable on a 30,000 rupees bill and 5,000 rupees on a 50,000 rupees electricity bill. He said the fixed fee of Rs 10,000 would be recovered on a bill above Rs 50,000 per month.
He added that inactive tax defaulters would be clawed back to pay double the amount of tax which ranged from Rs 36,000 to Rs 120,000 per year. He said it was a complex issue for small traders and the tax percentage was very high.
He called for wider consultation with the Federation of Pakistan Chambers of Commerce and Industry and representatives of the business community to reduce the tax percentage and fixed tax on retailers should be clawed back every year.
He said the recovery procedure should also be changed. He said rising tariffs for electricity, gas and petroleum products have undermined small and medium-sized enterprises (SMEs) and their closure would lead to massive unemployment.
Copyright Business Recorder, 2022