ISLAMABAD (April 30 2004): The Central Board of Revenue (CBR) has strongly opposed the Securities and Exchange Commission of Pakistan (SECP) budget proposal, which envisages tax rate of 'individuals' for the “Single Member Company” in budget 2004-05.
Official sources told Business Recorder here on Thursday that the SECP's proposal is not viable.
This proposal, if incorporated, may have revenue implications, but it could be exploited by certain quarters.
CBR sources said the SECP plea, which gives status of individuals to the “Single Member Company”, would encourage documentation.
However, even in case of individuals, the CBR has not given any concession on record keeping under the income tax law. Under the existing law record maintenance was already mandatory for the individuals.
In case tax rate of 'individuals' were applied on the “Single Member Company”, the concessions available to the 'individuals' under the income tax law could be availed of by the “Single Member Company”.
The sources said that the CBR has started reviewing budget proposals of the SECP as part of the ongoing exercise.
The company comprises at least three members. However, last year concept of “Single Member Company” was introduced wherein a single person could also form a company.
The SECP has asked the CBR to apply tax rate as applicable to 'individuals' on the “Single Member Company”, officials said.
CBR Chairman Abdullah Yousuf and SECP Chairman Dr Tariq Hassan had recently discussed budget proposals when Yousuf visited the SECP head office in Islamabad.