Sources told Business Recorder that the FBR Chairman has approved break-up of tax estimates for 2011-2012 during the maiden Chief Commissioners Conference convened at the FBR House with the newly appointed FBR Member IR. The FBR Member Inland Revenue and Director General Intelligence and Investigation Inland Revenue (IR) Shahid Hussain Asad along with his new team of Chief Commissioners for Large Taxpayer Units (LTUs) and Regional Tax Offices (RTOs) demonstrated full commitment and determination to achieve the assigned target for 2011-2012 under the guidance of tax authorities. The unique feature of the conference was that all the Chief Commissioners and new FBR Member IR showed confidence and vowed to work hand in hand to meet the FBR Chairman's determined revenue collection target of Rs 1952 billion for 2011-2012.
During the conference, the FBR has also fixed monthly and quarterly budgetary targets for Chief Commissioners of the LTUs and RTOs. The target of Inland Revenue including sales tax, federal excise duty and direct taxes has been estimated at Rs 320 billion for first quarter of 2011-2012. The exact figures would be communicated to the Chief Commissioners of the LTUs and RTOs here on Wednesday (Sep 14).
The FBR has categorically conveyed to the field formations that the revenue collection target of Rs 1952 billion would remain unchanged for 2011-2012. The FBR has also given two months period to the Chief Commissioners to ensure achievement of the assigned monthly targets for 2011-2012. The FBR has the legal authority to remove such Chief Commissioners from their current positions who would not be able to achieve the desired results. The monthly tax estimates (2011-2012) shared during the conference revealed that the monthly revenue collection target for September has been estimated at Rs 146.1 billion, October Rs 130.7 billion, November Rs 130 billion, December Rs 203 billion, January Rs 136.7 billion, February Rs 133.4 billion and revenue estimates for March has been set at Rs 180.7 billion during 2011-2012.
Sources said that the FBR Chairman Salman Siddiqui has informed the Chief Commissioners that the future of Pakistan is directly linked with the performance of the FBR to considerably reduce dependence on foreign loans by gearing up the tax machinery, generating internal resources and improving revenue collections to meet current and development expenditure.
The government would be in a position to reduce dependence on the foreign loans by reducing gap between the expenditure and income. The FBR can play key role in generating additional revenue which would ultimately reduce government's dependence on the foreign loans. It should be our aim to get rid of foreign loans through economic independence for which tax gaps would be narrowed by implementation of enforcement as well as documentation strategy. The political stability of the country is dependent on the economic stability.
For economic independence, tax machinery has to play a crucial role for achieving the assigned revenue collection targets. The professional approach of the tax machinery and taxpayer facilitation would play key role in improving tax collection. It has been informed that the gap between the income and expenditure could be approximately Rs 600-800 billion. This huge gap needs to be reduced by attaining self-sufficiency and documentation of rich people and sectors. Through effective implementation of documentation plan, the FBR can make the tax machinery more efficient, sources referred to tax authorities informing the chief commissioners.
The Chief Commissioner Conference under the chairmanship of Salman Siddiqui finalised the enforcement plan with particular emphasise on monitoring of withholding taxes and audit of registered persons on the basis of risk-based criteria. It was pointed out that if the Large Taxpayer Unit Karachi can collect huge amount of over and above of Rs 4.5 billion withholding taxes during the last two months of 2010-2011, the Chief Commissioners of the LTUs and RTOs have enormous potential for improving collection through proper collection of withholding taxes. By checking illegal sales tax adjustments, Post Refund Audit and monitoring of withholding taxes, the FBR can generate huge revenue during current fiscal.
Sources said that the number of withholding agents is much more as compared to nearly 25,000 as mentioned by the representatives of the Pakistan Revenue Automation Limited (PRAL) during the conference. The total number of withholding agents should be at least at par with the number of sales tax registered persons, who are also required to deduct tax at different stages. These sales tax registered persons are deducting or withholding tax at different stages.
According to the estimates of tax managers, the number of withholding agents should be at least 80,000 for which a proper list needs to be updated. Tax authorities clearly spelled out the tax facilitation plan to the Chief Commissioners of the LTUs and RTOs with the resolve that taxpayer facilitation is the cornerstone of the FBR's tax policy but not at the cost of the enforcement of legal provisions of the tax laws.
Sources said that the FBR Chairman stressed upon the income tax officials to have full command over the sales tax laws and the sales tax officers should fully learn the income tax provisions of the tax laws. In this way, the Inland Revenue Wing could work in the most efficient manner as the IR official would have full command over both the sales tax and income tax laws.
Salman Siddiqui has also assured the Chief Commissioners that the FBR has given top priority to the issue of promotions of tax officials of Inland Revenue Service and Customs Service Group where promotions are due for the last 2 years. In this regard, the FBR has approached the Establishment Division.
END.