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FBR chief Bajwa stresses improvement of Customs network to increase revenue collection

FBR chief Bajwa stresses improvement of Customs network to increase revenue collection

ISLAMABAD: Chairman Federal Board of Revenue (FBR) Tariq Bajwa has stressed on improvement of Customs network to enhance revenue collection from Customs department.

 “In his interaction with senior FBR official after arriving back from two day visit to Karachi, Bajwa expressed his dissatisfaction over their performance of Sales and Income Tax offices located in Karachi” a well placed source at FBR told this scribe here on Monday, adding that Bajwa got briefing from on the performance of the said departments.

 He also asked Customs officials to them to send budget proposals as early as possible along with proposals to increase revenue collection. He urged them to follow the best practices adopted by the leading international tax authorities as well as bring those practices in the notice of authorities.

 He asked to them to carry out maximum efforts for arrears recovery. He wanted to set a trend for upcoming fiscal quarter of the financial year to overcome shortfall of round about 100 billion of revenue collection

 Bajwa was dismayed over the perplexities and complexities associated with the Customs Department and its attached offices. During his visits to Customs offices, he pressed on the coordination among the relevant offices because all the issues brought in his notice were pertaining to Customs as Karachi bears ports where Customs related activities remain continue day and night.

 He also expressed his concern over the less revenue collection by Customs Department despite levying 5% Customs Duty on almost all imports in previous finance bill.

 Moreover, this duty has also affected Sales and Income Tax collection at ports because relevant authorities prefer to collect Customs Duty and officials assigned to collect Sales and Income Tax at Ports lack in pursuing the taxpayers due to presence of Customs officials.

 Therefore, Bajwa pressed on improving Customs mechanism along with an effective system to overcome the revenue collection shortfall of almost Rs 100 billion than the fixed target for the whole financial year.

 Finance Ministry and FBR have agreed to achieve the revenue collection target of Rs Rs 2691 billion with IMF. Although, the revenue collection rose by 27% year-on-year to Rs 181.906 billion in February, backed up by regulatory duties on several hundred items and hike in sales tax on petroleum products and the figure was Rs 143.224 billion in the same month of last year. The original target for February set in the latest budget was Rs 210 billion, but it was later revised downward to Rs 190 billion.

On this situation, FBR Chairman noted with dissatisfaction that currently revenue collection from Customs and Customs Duty is Rs 120 billions whereas the total imports are tune to $25 to 30 billion. Therefore, revenue collection from imports is far lesser than the export and growth is not as per expectations.

 Therefore, during his interaction with officials, he stressed a better mechanism is required to strengthen the week enforcement of Customs officials to tape the smuggling and smuggled goods through an effective and vigilant intelligence network. Moreover, strengthening of the Evaluation Department of Customs also needs to be mobilized and activated to check the under invoicing and evaluation of imported or exported goods.

 During his two day visit to Karachi, Bajwa did not paid more attention to Inland Revenue offices and most probably he will prefer scrutiny of Inland Revenue offices in his next visit.