FBR exceeds tax target, expected to collect Rs 1.005tr
ISLAMABAD: The Federal Board of Revenue (FBR) has crossed over the psychological barrio of Rs 1 trillion tax collection and the total collection is expected to reach over Rs 1.005 trillion against the provisional collection of Rs 1.002 trillion till June 30, 2008.
Muhammad Abdullah Yusuf, Chairman Federal Board of Revenue, announced this at a press conference at the conclusion of financial year 2007-08 focusing tax collection performance and explanation of budgetary measures announced in the budget 2008-09.
He said that during July-May period of last fiscal year 2007-08 the FBR has collected Rs 135 billion taxes and duty on POL products which includes sales tax at Rs 112 billion and customs duty of Rs 20 billion.
He said that amendments in the Economic Reforms Act have not empowered the income tax authorities to probe the foreign currency accounts. He clarified that the scope of the Capital Value Tax on immoveable property has reduced actually as its applicability has been limited to the rated areas of newly established district governments.
Investment Tax Schemes is a good opportunity for the existing as well as new taxpayers to legalise their hidden assets by paying 2 percent tax on fair market value of the assets. Now there is no excuse left for the new as well as existing tax payers to declare their hidden assets and get them legalised and be a part of formal economy. He said that no question about past years would be asked to those who would be availing facility of investment tax. He appealed that population having taxable income should come forward and contribute in the national development through their due contributions.
He also informed that government is also negotiating to revise Pakistan Afghanistan Transit Agreement to tackle the issue of smuggling as well as issues relating border trade. He said that a tracking system is being introduced to track the movement of trucks and trailers carrying goods meant for Afghanistan. This system would help trace trucks and trailers not entering Afghanistan. He did not denied the possibility that goods in transit to Afghanistan for NATO may be coming back to Pakistan.
He also explained that defense services are paying all taxes and duties as applicable on salaries, imports and purchases.
He said that for the current fiscal year 2008-09, the tax collection target is Rs 1.250 trillion with a required growth of 25 percent. This target has been set by assuming 17.3 percent nominal growth in the economy— 5.5 percent GDP growth and 12 percent inflation— making a total of 17.3 percent. Through this assumption the tax collection has been estimated at Rs 1164 billion. Some Rs 71.2 billion are expected to come through revenue measures announced in the budget which include Rs 26.7 billion in direct taxes side, Rs 38.2 billion from sales tax, and Rs 6.4 billion from customs duty, Rs 15 billion would be generated through efforts of the department with Rs 5 billion share in each tax i.e. income tax, sales tax and customs duty.
He explained that tax collection target of Rs 1.250 trillion would require growth of 27.3 percent in direct taxes with target of Rs 490 billion, 28 percent growth in sales tax with annual target of Rs 480 billion, 26.4 percent growth in federal excise duty with annual target of Rs 115 billion and 10 percent growth with annual target of Rs 165 billion is required to meet the said target.
Explaining the refund payment situation, he informed that FBR has paid Rs 68 billion as refund and rebates in 2007-08 as compared to Rs 82 billion in previous fiscal year 2006-07.
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