Discos: FBR eyes higher ST collection

The Federal Board of Revenue (FBR) is strictly monitoring sales tax collection from power distribution companies (Discos) to check their input/output adjustment of sales tax and to maximise collection from power sector in the last quarter (April-June) 2016-17.
In this regard, Regional Tax Offices (RTOs) have received instructions from the FBR on the monitoring of sales tax payments by Discos for February and onwards.
Sources said that the ongoing exercise would increase sales tax collection from Discos in the remaining period of 2016-17.
According to the FBR's instructions to the field formations, the RTOs and Corporate Regional Tax Offices (CRTOs) are expected to closely monitor sales tax collection from Discos under their respective jurisdiction. The launch of the initiative has also helped in this regard and Discos have started filing Annexure "C" of the sales tax returns, enabling the FBR's field formations for real time monitoring concerning their input/output adjustment of sales tax.
The increase in the input tax by Discos from November 2016 onwards necessitated an in-depth analysis of Central Power Purchase Agency's accounts. The RTO Faisalabad requested CRTO Lahore having jurisdiction over CPPA for an in-depth analysis. The result of this analysis transpired that the value of credit notes by CPPA to the Discos will amount to Rs3.60 billion for the tax period of July 2016 to February 2017. The said amount will be distributed among all the Disos as per their shares. The details of this amount are under preparation and will be available with the Discos during the current month, while filing their sales tax returns for February 2017. The field formations, having jurisdiction over Discos, are required to be alert in this regard by maintaining a close liaison with the respective distribution companies. The attached annexure will enable each RTO for working of the credit amount. All RTOs, having jurisdiction over the Discos, are required to make their work accordingly, FBR said.
The Board appreciates the CRTO Lahore's initiative in this regard. The payment of credit note for July 2016 to February 2017 will be pursued further by the CRTO Lahore and its outcome will be shared with the Board, accordingly, qaumi according to FBR's instructions.