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Targeted-survey being launched to unearth rich tax evaders: Bajwa

Targeted-survey being launched to unearth rich tax evaders: Bajwa

ISLAMABAD: Federal Board of Revenue (FBR) has almost achieved its Rs509 billion target set for the first quarter of fiscal year 2013/14 as it has collected Rs481 billion so far and the total revenue collection target for the current fiscal year is Rs2,475 billion.

FBR Chairman Tariq Bajwa told this to the Senate Standing Committee on Finance head by Senator Nasreen Jalil at Parliament House. Senator Sardar Fateh Muhammad Hasni and Senator Sherala Malik were also present in the meeting.

Bajwa briefed the committee that the Board did not impose any new tax to achieve the target. He denied the government has increased sales tax rates from 17% to 19% on dozens of items as was reported by a section of the national media.

“There is no question of raising the tax rate by 2%. We’ve changed the mechanism of computation in the value addition of certain products from consumers end to manufacturers,” he said. “This will have no extra impact on consumers, because it is even less by 0.5% as compared to the past,” he added.

According to the FBR chairman, around Rs168.02 billion direct tax, Rs235.5 billion sales tax, Rs25 billion in Federal Excise Duty (FED) and Rs52.4 billion in customs have been collected so far.

About the conditions set by the International Monetary Fund (IMF), he said the government is working on its commitment with the IMF to bring 100,000 people into the tax net. As many as 1,200 new people have so far been brought under the tax net during the current fiscal year.

“We will review data of all these users to identify potential taxpayers,” he said, adding that the FBR has, so far, issued notices to 30,000 people in the past three months for bringing them to the tax net. Of these, only 1,000 or 1,200 people have filed tax returns with the FBR, the chairman said. However, he said that the board would take up the issue with the rest of the people who did not file tax returns so far.

For the tax year 2013, the FBR has extended last date for filing of tax returns till Oct 31.

Tariq Bajwa also informed the Senate Standing Committee that the FBR is going to launch a targeted-survey soon to net rich tax dodgers. “The targeted survey is the way forward. We are collecting data from various sources,” he said. The FBR is also working on data collection of the people who frequently travel abroad, he added.

Bajwa said that the FBR had already approached housing authorities to collect data about investors’ transactions in real estate to identify whether they are paying or avoiding income tax.

Overseas Pakistanis were sending their money through remittances, which mostly end up in real estate. However, the tax machinery has no accurate data about these investments.

The committee was informed that government is considering reducing the duty on material used for production of bulletproof vehicles to facilitate the sector and FBR is working with ministries of Industries and Production and Commerce.

It is mention worthy here that only around 711,940 people in a population of 180 million filed e-returns with the revenue collection authority last year, which is less than 0.4 per cent share of the total population.

The FBR chairman said that the board is also collecting data regarding commercial electricity users which includes shops and offices. The FBR has already approached relevant departments for getting relevant data, he added.

Bajwa said that information would be collected about artists, players, doctors and lawyers under the survey. “We will bring these people to the tax net as well,” he said.

The federal tax collection authority has also decided to impose tax on those who are paying Rs200,000 tuition fee annually.

Tariq Bajwa said information through expensive private schools would be collected and only those schools in this regard will be targeted who are collecting at least sixteen thousand rupees in terms of monthly fees. There are several schools that are charging high fees but not paying taxes.

The chairman, however, did not mention the exact date and time for launching the survey. He said that collection of general sales tax on services would also be improved.