Finance Bill 2019-20: KCCI urges FBR to withdraw section 108AB

President KCCI Junaid Esmail Makda has urged FBR to withdraw the provisions under 108AB of the Finance Bill FY20 that has triggered severe anxiety amongst the business community. He pointed out that under section 108AB, a person supplying products listed in the 3rd Schedule to the Sales Tax Act 1990 or any other products as prescribed by the board, under a dealership arrangement with the dealers who are not registered under the Sales Tax Act 1990 and are not appearing in the ATL under this Ordinance, an amount equal to 75% of the dealer’s margin shall be added to the income of the person making such supplies. Moreover, it has also been notified that for the purposes of operation of this section, 10% of the sale price of the manufacturer shall be treated as dealers’ margin, which is injustice. He said that on one hand, they are already called withholding agents and collectors while on the other, it seems that the policy makers want them to become enforcers of tax provisions as well although it is purely the job of FBR. This continues to create difficulties for businesses who would have to do the job of the tax authorities, bear costs of additional book keeping and then subsequently face the harassment of the tax officials. He said it would have been better if these taxes and duties were either done away or some compensation were extended to the businesses for performing this additional service on behalf of the tax authorities. Makda said that KCCI is currently reviewing the entire Finance Bill, taking input from all stakeholders and identifying several anomalies which will soon be submitted to the FBR with a request to rectify them on top priority basis.