Business community rejects GST on Security Services


KARACHI: Representatives of trade and industry, while vehemently rejecting GST imposed on security service providers, said that the private security companies were already paying large amount of direct and indirect taxes whereas additional tax would eliminate this vital and essential service by making it financially unviable.

The business community representatives expressed their concerns over imposition of unjust sales tax imposed on security services during a meeting with Chairman of Sindh Board of Revenue (SRB), Tashfeen K. Khalid who visited KCCI along with Advisor SRB, Mushtaque Kazimi and Commissioner-I SRB, Tariq Hussain Tunio.

Vice Chairmen of Businessmen Group, Haroon Farooki and Anjum Nisar, President KCCI, Abdullah Zaki, Senior Vice President KCCI, Muffasar A. Malik, Vice President KCCI, Muhammad Idrees, Chairman of KCCI Sub-Committee Provincial/ Local Taxes & Allied Matters, Shahzada Nasir Maqbool and other Managing Committee members also attended the meeting.

Speaking on the occasion, President KCCI Abdullah Zaki said that it is the prime responsibility of the Government to ensure security to the lives and properties of the citizens but the Government has failed to do so, leaving no other option for the business community but to hire private security guards, resulting in additional expenses on security, whereas the imposition of GST on Security Services would further exacerbate the situation.

“The government should help and facilitate the business community instead of imposing such levies and taxes on this important segment of society”, he added.

He requested the Sindh Government to withdraw this tax which is creating chaos for the business community yet the businessmen are trying their best to continue their businesses in extremely unfavorable circumstances.

He hoped that the discussions in meeting with SRB shall be considered by the government and the decision makers will facilitate the business community by withdrawing this unjust levy.

Vice Chairman BMG Haroon Farooki, on the occasion, said that it is a welcoming sign that SRB has given priority to exchange views, take inputs and keep the business community well-informed about SRB’s functioning and its tax collection policies, which will certainly pave way for not only ensuring smoother operation for SRB but also provide a hassle-free service to the taxpayers.

Vice Chairman BMG Anjum Nisar, while referring to imposition of GST on security services, demanded that it must be withdrawn as this step is penalizing the business community. Anjum Nisar, while appreciating SRB’s initiative to meet KCCI office bearers, suggested that such meetings should be held regularly on quarterly basis so that the tax issues being faced by business community could be timely discussed and resolved.

Chairman of Sindh Revenue Board (SRB), Tashfeen K. Niaz has said that SRB is on track to achieve the tax collection target of Rs42 billion for fiscal year 2013-14 as the Board has collected a total of Rs14.79 billion till 30th November 2013, indicating a rise of 9.79 percent as compared to the same period of previous fiscal year.

Delivering a presentation during his visit to Karachi Chamber, Tashfeen said SRB’s Revenue Collection Budget was increased by 31.25 percent in 2013-2014, against an increase of 28 percent for 2012-2013, which depicts the confidence of Sindh Government in SRB’s ability to accept challenges.

“SRB is the only tax authority in Pakistan which exceeded its budgetary tax collection target”, Tashfeen said, “We are not another FBR in the making as SRB, instead of being known as a tax collector, wants to be recognized as tax advisor. We are trying to create an Authority which facilitates tax collection for the province.”

Highlighting the purpose of delivering a presentation at KCCI, Chairman SRB said that this presentation was part of SRB’s policy to work closely with all stakeholders including KCCI and other chambers of commerce so that SRB could raise awareness amongst the business community about the tax collection process and take inputs in order to ensure enhanced revenue collection for the province and promote a business friendly environment.

Tashfeen Niaz informed that the objective of SRB is to generate revenue through collection of sales tax on services through the implementation of Sindh Sales Tax on Services Act, 2011, applicable on services provided or rendered from tax period July 2011. He said that SRB and Punjab Revenue Authority were created following the 7th NFC and 18th Constitutional Amendment with the spirit of giving provincial financial independence to the provinces.

Chairman SRB mentioned that a total of 6522 taxpayers belonging to various sectors of Sindh’s economy are currently registered with SRB.

He pointed out that SRB faces some legal issues with Federal Board of Revenue, Punjab Revenue Authority, KPK Revenue Authority which if timely resolved will help in ensuring smoother operations for SRB, besides streamlining the taxation system in Sindh province.