Brief Comments on the Voluntary Tax Compliance Scheme for Traders
FBR has proposed to introduce special tax regime for certain traders (individuals and associations of persons only) by inserting a new section viz 99A and Ninth Schedule in the Income Tax Ordinance, 2001 (the Ordinance). The Primary purpose of the Scheme is to broaden the tax net of the Government and to facilitate non-filers and certain filers to come into the tax net and regularize their tax affairs by paying tax liability on turnover, working capital, etc. in a simplified manner in respect of Tax Years 2015 to 2018.
Traders opting under the Scheme would be exempt for above referred tax years in respect of income tax audit and assessment under section 122(5A) of the Ordinance. Traders would also be exempt from the application of section 111(3) of the Ordinance with regard to undeclared source of income in any proceedings initiated against them subsequent to Tax Year 2018 to the extent of imputable income subjected to tax under the Scheme. It is pertinent to mention that no exemption is made available with regard to sales tax and federal excise duty.