PESHAWAR, Oct 27: The Khyber Pakhtunkhwa chapter of Markazi Tanzeem Tajran has demanded of the federal government to announce tax exemptions for the business community of the province due to the adverse effects of war on terror.

According to a press release, the MTT has asked the federal government to restore the facility of fax refund that was introduced by the previous federal government.

The president of MTT, Khyber Pakhtunkhwa, Haji Haleem Jan said the previous federal government had declared Khyber Pakhtunkhwa a war affected province. He said Khyber Pakhtunkhwa`s businessmen were exempted from taxes to help them out in countering the adverse effects of war on terror on businesses in Khyber Pakhtunkhwa. He said the Pakistan Muslim League-N should also declare Khyber Pakhtunkhwa a war affected area and extend tax exemptions to help businesses.

He said the Federal Board of Revenue should be directed to process the cases of all those businessmen who had applied for tax refund under the previous tax exemption scheme and their claims remained to be cleared. He said while the businessmen had already passed on the discount to customers by depreciating the prices of their products, their tax refund claims had been pending since long to the business community`s disadvantage.

The MTT has also called upon the Federal Board of Revenue to take notice of the fleecing practices by some of the cellular companies who, the MTT added, were misusing loopholes in the system.

Haji Haleem said that while local businessmen were being pressed hard to pay income tax, cellular telecom companies were not being pressed to pay their due taxes. `Cellular operators,` said Haji Haleem Jan,`deduct 42 per cent withholding tax in advance from their subscribers/franchises at the time of recharge (scratch cards and easy load) and deposit the same amount to the government account as per usage of the recharge value and as a result the companies withhold billions of rupees in their accounts without being noticed by the federal government.

The MTT leader said the cellular companies, by virtue of withholding the tax money, were using it as an interest free loan. These companies, he added, were earning millions of rupees mark up by holding the government money in their bank accounts.

In the case of one company, added the MTT leader, `its monthly turnover is approximately Rs10 billion of which the amount of monthly tax advance deductions comes to Rs4.2 billion.` He said the companies should be directed to deposit the advance tax to the government account on daily or latest on weekly basis.

He said the federal government should also look into the telecom sector`s financial affairs as some of the companies had not been paying taxes year af ter year at the cost of the national exchequer.