FBR proposes new taxation measures

The Federal Board of Revenue (FBR) has proposed new taxation measures to meet the revised revenue collection target of Rs 1630 billion for 2010-11 to deal with the unusual economic situation in the country for generating additional revenue.
Responding to various queries on revenue collection targets and new taxation measures, Federal Board of Revenue (FBR) Member Inland Revenue Khawar Khurshid Butt told reporters on Friday that the Ministry of Finance and FBR are seriously examining the new revised target of Rs 1630 billion, including new taxation measures.
However, the new measures are merely proposals of the FBR which have not yet been finalised by the government. At this stage, it would not be appropriate to share such taxation proposals of generating revenue collection. The figure of Rs 1630 billion includes one percent increase in special excise duty and flood surcharge.
In case the government approves the FBR''s proposals, some measures would be enforced with immediate effect, he said. In the current economic situation the government is solely depending on the revenue collection agency for generating additional revenue, the FBR Member IR added. There is a situation like financial emergency in the country where floods have adversely affected the revenue collection. The situation of the economy is very bleak as partial closure of manufacturing sector has also negatively affected the revenue collection. The foreign inflows are less and talks are going on with the IMF for release of next tranche. Hopefully, the talks between the government and IMF would bear positive results. The tax collectors have to make all-out efforts to increase revenue collection just like Pakistan army, which fought against terrorism.
The law enforcement agencies have given sacrifices during the war against terror. The tax machinery has to follow the same path for generating revenue for the country as the FBR is the sole agency for generating revenue. The government has also cut its expenditures and now the whole pressure of revenue generation is on the FBR for which the tax collectors have to play their due role. It would be an uphill task for the tax managers to achieve the revenue collection targets. "Realistically, floods have impacted revenue collection, but we cannot quantify the exact impact of floods on revenue," he said.
He added that through better monitoring of withholding taxes and quarterly statements and other returns, there would be improvement in the overall revenue collection. When asked about Plan-B of the FBR, Khawar said: "I am not aware of any Plan-B of the FBR. Any kind of Plan-B is not in my knowledge."
The remaining few months of current fiscal 2010-11 are very important and field formations have to make extraordinary efforts for maximising the revenue collection. There was some shortfall in January 2011, but the situation has been considerably improved in February 2011. Once the data of revenue collection in February would be compiled, the overall situation of collection is expected to improve in 2010-2011. When asked about the audit of Pakistan Revenue Automation Limited (PRAL), he said that the PRAL is operating under the board of directors and top management of the FBR is dealing with the affairs of the PRAL.