ECONOMICS - TURNING THREATS INTO OPPORTUNITIES (WHT Regime Rates and Refund)

WHT Regime Rates and RefundOld assesses and now the taxpayers dont know that two provisions of WHT imported from Income Tax Act, 1922 now spread over existing Income Tax Ordinance, 2001 to cater the taxability of transactions. Although the WHT provisions cover almost all major types of transactions but FBR failed to facilitate the business that are currently facing two major problems.
Firstly, the payer businesses normally add up the WHT rate on top of the value of invoices just to remain in businesses and in need of supply or service. Secondly, the taxpayer being prospective recipient of WHT payment receipt cannot oblige the payer of to provide him or her either WHT deduction certificate or Tax Payment receipt, as there is no redresser or penal provision to compel them. Consequently, the refunds are not always verified.
FBR must incorporate a modus operandi to curb this menace. A suggested modus operandi may include appearance of such grossing up either on the face of WHT payment receipt or statement under section 165 apart from redresser or penal provision for obtaining the WHT receipt. Please check my detailed article on WHT problems published earlier.
Article courtesy of Muhammad Ashraf