Govt likely to issue notices to industrialists for tax evasion

PESHAWAR: The Khyber Pakhtunkhwa government is likely to issue show cause notices to owners of about 20 industrial units for not paying infrastructure development cess, according to sources.

They said that provincial government had levied one per cent infrastructure development cess on imported items. “Now majority of the businessmen have started clearing their goods in Karachi to avoid the tax,” they added.

Sources said that the practice had caused huge loss to the Customs department. They said that imported goods worth Rs21 billion had been cleared in Karachi since imposition of one per cent infrastructure development cess in Khyber Pakhtunkhwa.

Sources said that businessmen, especially industrialists, tried to evade the tax by bringing the imported goods directly to their industries .Customs department suffered a loss of Rs820 million while provincial government faced a loss of about Rs30 millions within two months, they added.

Sources said that a meeting of officials of various relevant departments was held in Peshawar to devise a strategy for taking action against all those, who were evading the tax.

An official said that Customs department presented all details in the meeting that showed that 20 industrials units including eight in Peshawar, 10 in Hattar Industrial Estates, and two in Gadoon Industrial Estates, had violated the rules.

The excise and taxation department officials decided to issue show cause notices to the concerned industrialists. Besides, the meeting decided to set up checkposts on Gran Trunk Road and motorway to check illegal transportation of goods.

The Customs officials also suggested decreasing the one per cent infrastructure development cess to 0.75 per cent.

It is to be mentioned here that traders and industrialists are opposing the one per cent cess, describing it dual taxation.

Khyber Pakhtunkhwa Chamber of Commerce and Industry president Zulfiqar Ali Khan said that the tax was illegal and businessmen had already rejected it. He asked the government to withdraw its decision otherwise the community would have to launch agitation against it.

“We pay tax on imported goods in Karachi. But we are forced to pay it in Peshawar too on duty-paid items. It is injustice with us,” KPCCI former senior vice president Ziaul Haq Sarhadi told Dawn.

He said that businessmen in the province had already suffered heavily owing to militancy. They needed support of government but rulers were imposing new taxes on them, he added.

Mr Sarhadi urged the provincial government to avoid teasing the business community and extent full cooperation to it so that local economy could be strengthened through collective efforts.