KARACHI: Karachi Chamber of Commerce and Industry President Abdullah Zaki has shown his discontent about SRO 115 (I)/ 2014 issued by the Federal Board of Revenue through which banks will provide information about their accountholders without national tax numbers (NTN) and who deposit more than one million rupees or pay Rs100,000 in credit card bills in a month.
In a statement, Zaki has urged Prime Minister Nawaz Sharif, Federal Finance Minister Ishaq Dar and FBR Chairman Tariq Bajwa to immediately revoke the SRO which has triggered anxiety amongst businessmen, bankers and accountholders.
As per a statutory regulatory order issued by FBR, banks are bound under section 165A of the Income Tax Ordinance to share with FBR the non-NTN holders’ monthly statements of deposit, credit card payment and currency and suspicious transactions. Moreover, the rule obliges every bank to furnish to FBR an annual statement of written-off loan exceeding one million rupees. FBR has also asked the banks to give it online access to their database of the clients, containing details of accountholders and all their transactions.
KCCI President cautioned that this unfair step will create more problems not only for the accountholders but also for the banks as people whose accounts information is being shared with FBR, will prefer to stay away from banks or maintain accounts out of this country, which will result in flight of capital and affect profitability of banks.
He was of the view that it would obviously prove counterproductive as people will avoid using banking channels to carry out their transactions and prefer dealing in cash.
Zaki said that although the business community was assured that the SRO culture will be dealt with effectively but to date no relief has been provided and the business community continues to face imposition of such unfair SROs, which must be stopped as such attempts will never enhance tax revenue but will only promote corruption in the country.
Abdullah opined that this new SRO is likely to be condemned by banks as well as it will terribly affect relations between banks and its customers.
As the law and order situation is already in bad shape, flight of capital persists and foreign investment remains low, the government must desist from taking such steps that are likely to trigger severe backlash across the country. Any backlash against this particular SRO will certainly be supported by the KCCI, he added.