Senate Panel Proposes More Strict Penalties For Late Filers

Senate Panel Proposes More Strict Penalties For Late Filers

The Senate Standing Committee on Finance and Revenue convened for its 5th session to study the provisions of the Income Tax Ordinance, 2001 as outlined in Clause 6 of the Finance Bill 2024.

The committee members were apprised of the introduction of a new category termed “Late Filer” under the Income Tax Ordinance, targeting individuals who sporadically file returns without consistent adherence. The committee underscored the need to impose stricter penalties, proposing a 10 percent tax levy and withdrawal of previous concessions.

Chaired by Senator Saleem Mandviwalla, the meeting saw the participation of committee members including Senator Sherry Rehman, Mohsin Aziz, Anusha Rahman Ahmad Khan, Shahzab Durrani, Farooq Hamid Naek, Shibli Faraz, and Senator Manzoor Ahmed Kakar. In attendance were also the Chairman Federal Board of Revenue (FBR) and representatives from relevant departments.

Clarifications were provided regarding the misunderstanding around international travel restrictions related to NTN numbers on passports. Addressing misconceptions, Chairman FBR clarified that the requirement to link NTN numbers with passports for international travel applies only after due notice and inclusion in the income tax general order, dispelling public concerns regarding immediate travel restrictions.

Furthermore, amendments were highlighted to include provisions for the taxation of capital asset transactions and extend the carry-forward period for business losses, notably benefiting entities like Pakistan International Airlines. and the introduction of 100 percent tax credits for coal mining projects in Sindh. The committee expressed unanimous support for extending similar benefits to other provinces.

The committee also deliberated on advertising expenses related to brand royalties, expressing reservations on proposed clauses affecting local investors and ownership control thresholds.

In response to queries regarding income tax on imports, committee members expressed astonishment over proposed methods for determining minimum taxable values, advocating for customs evaluations as the standard practice. The committee expressed reservations and deferral of the amendment for further review alongside sales tax amendments.

Earlier decisions included approval to revise tax slabs, rejection of a proposed capital gains tax on property, and endorsement of withholding taxes on phone and internet services for non-filers. Proposals regarding property tax extensions for FATA and PATA were postponed, pending reconsideration.

The committee also addressed concerns regarding the 18 percent General Sales Tax on packaging items and locally processed milk products, advocating for reductions to alleviate consumer burdens, particularly on essential items such as infant formula.

Senator Sherry Rehman emphasized equitable tax distribution among corporations, advocating against shifting tax burdens onto consumers for products like formula milk. Sherry Rehman indicated Nestle as a profitable company that can pay its own taxes and lamented that Nestle should not have a monopoly over baby formula milk. Her stance reflected broader concerns over corporate responsibilities in ensuring fair tax contributions.

The post Senate Panel Proposes More Strict Penalties For Late Filers appeared first on ProPakistani.