The Central Board of Revenue (CBR) has introduced a number of reforms for improving tax administration at Large Taxpayer Unit (LTU), Karachi.
Around 45.5 percent of Karachi tax revenue comes from 600 Karachi based large taxpaying units.
A CBR report said that LTU has developed software for electronic transfer of data for speedy processing of documents by the large taxpaying units.
For electronic compliance mechanism, filing of statements of withholding tax has been routed through electronic media.
Various types of statutory statements are furnished by the withholding agents on quarterly, half yearly, and yearly basis. Owing to the bulk of data involved in these statements, the activity bears substantial compliance cost.
The department has developed a software of 'Withholding Tax Management' , which would not only facilitate the taxpayers in easy preparation of such statements, but will also enable them to electronically transfer the data to the department.
This has reduced the frequency of contact between the taxpayers and tax officials. Furthermore, the department intends to effectively use the data for analysis of collection.
At present, 84 officers and 52 staff members are working in the LTU. The number of technical persons has been increased and non-technical personnel drastically reduced.
The LTU has prepared taxpayers' profiles for the last five years, due to which issuance of exemption certificates, auditing of taxpayers and enforcement and collection of arrears has become easier.
The databank for all sales tax payers and central excise collection has been completed.
Linkages have also been developed with Customs House database through radio connectivity.
With the installation of necessary hardware, the data sharing across the taxes has commenced which will further strengthen the audit capacity.
On the issue of taxpayer facilitation, all applications of exemption from various provisions of withholding tax are responded within 24-48 hours.
The response time of taxpayers' queries has greatly improved due to posting of tax managers at taxpayers assistance centres.
Moreover, the officials of LTU are regularly attending the tribunal and appellate hearings in all cases to expedite the dispute resolution process.
This shows that the LTU has been instrumental in reducing the compliance cost of large taxpayers, secure revenue, improve audit capacity, monitor arrears and integrate taxes.