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RTO-II posts 60pc growth during February: Badaruddin Ahmed

RTO-II posts 60pc growth during February: Badaruddin Ahmed

KARACHI: The outstanding efforts of broadening the tax base (BTB) helped Regional Tax Office (RTO)-II to achieve above 60 percent revenue collection growth in February 2020.

Talking to media, he said “the tax office worked aggressively and brought many new taxpayers into the tax net belonging to various sectors of the economy”.

It is pertinent to mention that the tax office posted an unprecedented growth of 60 percent in revenue collection to Rs12 billion in the month of February 2020 as compared with Rs7.5 billion in the corresponding month of the last year.

The last date for filing income tax returns for tax year 2019 was February 28, 2020 and officials of the tax offices persuaded potential taxpayers to discharge their liabilities in order to avoid 100 percent additional withholding tax payment on various transactions.

“We have identified persons in many professions including doctors, lawyers, chartered accountants, personal care, marriage halls, event organizers, educational institutions etc,” the chief commissioner said, adding that the identified persons were asked to file their annual income tax returns and declaration of assets.

In order to facilitate the taxpayers, the office engaged volunteers of a social organization to help the persons in filing their returns. The volunteers visited premises of potential taxpayers and aware about their responsibilities and helped them filing returns, he added.

“The office also issued notices to those persons who have taxable income but remained non-compliant,” the chief commissioner said, adding that penal provisions were also invoked against non-compliant persons.

The collection of RTO-II Karachi during July – February 2019/2020 also registered 31 percent growth to Rs76.54 billion as compared with Rs58.35 billion in the same period of the last fiscal year.

According to the statistics the RTO-II collected Rs72 billion as direct taxes during first eight months of current fiscal year as compared with Rs54.43 billion in the corresponding period of the last fiscal year, showing 40 percent growth.

The collection of tax from profit on debt increased to Rs43.75 billion during first eight months of current fiscal year as compared with Rs15.32 billion in the same period of the last fiscal year.

The sources also attributed the rise in tax under this head to attractive interest rates. The SBP maintained the key policy rate at 13.25 percent for the last three policy decisions.

Besides, imposition of 100 percent additional withholding tax on persons not appearing on the Active Taxpayers List (ATL) was also one of the reasons for massive growth.

“Although the provision of 100 percent additional withholding tax has boosted the revenue collection but at the same time some heads registered massive fall in collection due to exclusion from this condition,” Badar Qureshi said.

The RTO-II Karachi witnessed steep fall in collection from cash withdrawal from banking system. The collection of withholding tax from cash withdrawal fell to Rs5.2 billion during July-February 2019/2020 as compared with Rs14 billion collected in the corresponding period of the last fiscal year.

The office collected Rs4.45 billion as sales tax during July – February 2019/2020 as compared with Rs3.89 billion in the same period of the last fiscal year, showing 14 percent growth.

In sales tax the tax office also took measures to facilitate regarding installation of Point of Sales (POS) for registered persons.

Badar Qureshi said that the tax office had launched campaign for facilitations of registered taxpayers in sales tax to install POS and avoid penal action.

The tax office also collected an amount of Rs43.5 million as federal excise duty during first eight months of current fiscal year.