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That the quandary at the Central Board of Revenue (CBR) has acquired bewildering proportions should become all the more evident from two Recorder Reports, simultaneously appearing on October 29.
According to one, having identified serious discrepancies in the NTN database, CBR has constituted a task force to start cleansing data of such taxpayers as have either closed their businesses or are not operating, for any reason, since 1995.
Headed by Qudratullah, RCIT, Northern Region, Islamabad, its members include Imtiaz Ahmad Khan, Chief, Automation (DT) PRAL, Ruqayya Khan, Project Director (NTN Project) PRAL, and Shaukat Cheema, Second Secretary (Tax Base), the task force is stated to have been apprised of the seriousness of the problems, along with the efforts made to remove the baffling discrepancies.
It will be noted that reference, in this regard, has been made to swelling of the NTN Master Index to 2,500,095 through gradual registration of taxpayers since 1995.
However, while pointing out that even though field formations of Direct Tax Wing have removed the inactive taxpayers from their records, they are have failed to add the names of the taxpayers newly registered by the NTN Cells of PRAL.
This is stated to have resulted in the number of taxpayers reported by field formations as totalling 1,910,000, as against the CBR data which places the figure at 2,500,095, thereby revealing a discrepancy of 590,095 cases.
Moreover, it has been pointed out that, as a result of the exercise conducted by CBR for verification of NIC/CNIC Numbers with Nadra, NICs of about 740,000 NTN holders could not be verified through electronic matching. Similarly, mention has also been made of the issuance of duplicate NTN in many cases, along with cleansing of data of infraction cases, as pending with the concerned departments.
Again, a large number of taxpayers are stated to have been registered without allocation of Income Tax Zone/Circle Code, thereby, creating documentation problems for the income tax department.
All these inconsistencies, put together, will point to confusion worse confounded, thereby creating a plethora of problems in cleansing of the NTN Master Index, that have been assigned to the task force, which has been asked to submit its recommendations on top priority basis.
As for the second news report, it says that the Revenue Board would start reconciliation of companies having National Tax Number (NTN) with the Securities and Exchange Commission of Pakistan database, to identify the companies operating without tax number, at the Commissioners of Income Tax Conference.
The effort, it said, would help the income tax department trace all missing companies registered with the Commission, which failed to obtain NTN from the CBR.
In this regard, it has been pointed out that CBR has the data of registered companies from the SECP. Needless to point out, quite an ambitious exercise though, expectations from the deliberations at the conference are unlikely to be fulfilled to the Revenue Board's entire satisfaction.
This, of course, has reference to glaring lack of co-ordination between the SECP and the Revenue Board. This should leave little to doubt about the fact that these issues have remained under discussion over several years, but without any success in so far as development of an unfailing system is concerned.
There can be no denying that too much time and money have gone into multidirectional efforts to increase tax receipts through widening the tax base, through reforms and use of modern, sophisticated means, including high computerised devices, as adopted at the National Database Registration Authority (Nadra).
However, although it helped streamline systems in several other departments of the government, in so far as the Revenue Board is concerned, it has remained largely beset with a host of problems, both old and new. Be this as it may, the fact remains that the remedy lies, essentially, in streamlining the tax database, for which an objectively conceived and scientifically pursued plan will appear to be the only way.

Copyright Business Recorder, 2005

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