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Benami law likely to become operational this week: FBR Member Hamid Attiq Sarwar

Benami law likely to become operational this week: FBR Member Hamid Attiq Sarwar

ISLAMABAD: Federal Board of Revenue (FBR) Member Tax Policy, Hamid Attiq Sarwar has said that benami law is likely to become operational during current week, allowing the government to take strict actions against the real owners of benami asset holders and confiscate the benami properties in the favor of government.

Addressing a press briefing with Member Inland Revenue Operations Seema Shakil, Hamid Ateeq said that this was a very harsh law under which the government would confiscate all properties and bank accounts that would not be registered with the name of real owner.

He informed that the benami act was passed in January 2017 and now after finalizing of its rules and regulations, the law would become operational by February 7-8.

He said this law would act hard on those who registered their properties, bank accounts or vehicles on other beneficiaries’ name in order to evade taxes.

Briefing the media about revenue collection, Member Inland Revenue Operations, Seema Shakil said that during the period July-January 2018-19, the FBR collected Rs2,060.757 billion against Rs1995.277 billion collected during same period of last year, showing an increase of around 3 percent. She said that there was a shortfall in revenue collection mainly due to relief in tax measures while contraction of Federal Public Sector Development Programme (PSDP) also negatively impacted the revenue collection.

She said the Federal Board of Revenue was expecting a revenue shortfall of Rs350 billion by the end of June 2019 against the target of Rs4398 billion set by the government for year 2018-19.

She informed that during the period under review, total domestic revenue stood at Rs1,057.651 billion against Rs 1,050.455 billion collected during first seven months of the year 2017-18.

Similarly, total revenue collection on imports stood at Rs 1,003.105 billion during July-January (2018-19) against Rs 944.822 billion collected during same period of the preceding year.

Total income tax also increased to Rs 755.075 billion from Rs 754.902 billion, while net Sales Tax increased to Rs 798.832 billion in July-January (2018-19) from Rs 805.163 billion in same period of last year while Customs duty increased from Rs 330. 217 billion to Rs 389.456 billion, she added.

To a question, Hamid Ateeq said tax relief announced by the government recently would help increase in revenue in the long term. “The government had two options whether to raise taxes immediately or to give tax relief in a bid to strengthen economic growth in the country”, he added.

He said if the government had opted raising taxes, although it would help increasing revenue for short time but due to this move, the government would have lost confidence among business community and common people ultimately damaging the economy in long term.

On the other hand, he said the relief measures might have some short term negative impact on revenue collection, but it would help increase level of trust among the people and the business community on the government.

To another query, he said the only solution to resolve the matter of overlapping of taxes among provinces and between provinces and federation, was establishment of a single tax authority.