Cantt boards, DHAs also to pay property tax: audit of 14 sugar mills conducted

Central Board of Revenue (CBR) Chairman Abdullah Yusuf has said that so far the CBR has conducted income tax audit of 14 sugar mills, and this process will continue in future while a policy will also be chalked out in this regard.
He was talking to media persons at a function held here on Saturday by the office of Regional Commissioner of Income Tax (RCIT) on his promotion as secretary general Revenue. The function was attended by RCIT Haji Ahmed and other officials of the department. The CBR''s focus is on broadening the tax base, he said. He also called for increasing the revenue under the head of withholding tax.
About revenue collection, he said that CBR has so far collected Rs 700 billion against the target of Rs 690 billion set for the current financial year, which shows 20 percent growth. This ratio was 13 to 14 percent during the last financial year.
He said that CBR would achieve the Rs 835 billion target set for 2006-07. Talking to newsmen after addressing a post-budget seminar organised by Lahore Tax Bar Association (LTBA) here, the CBR chief said that cantonment boards and defence housing authorities (DHAs) have also been brought under property tax net and they are not exempt from this levy imposed in the 2006-07 budget.
"There is still a lot of gap in the tax regime, which the government plans to improve under the new system. Now we are moving from self-assessment to universal self-assessment system which is also being replicated in customs''''.
Under the new system, the number of appeals in income tax has substantially been reduced, he said. About CARE system, he said it would be implemented at all stations by the end of next financial year.
Earlier, addressing the seminar, Yusuf said that CBR was focusing to reduce the problem of litigation; and in the first phase it disposed of all pending cases at commissioners'' level. In the second phase, it approached the Supreme Court to constitute a special bench to dispose of the pending cases at highest level. Till December, last year, around 90 percent appeals at the Supreme Court level were disposed of, while the remaining 10 percent would be liquidated in a few months. Similarly, he said, there had also been a significant reduction in litigation at the income tax appellate tribunals level and. Hopefully, all pending appeals would be disposed of by the end of the current financial year, he added.
The concept of ADR was also a step towards this direction, which is a mode of out-of-court settlement of cases.
Yusuf said that now the government''s focus was on exploiting the potential of growth and this important aspect unfortunately had been neglected in the past. "If we look back, up till 1960s, today''s Asian tigers were far behind us, but later we were unfortunately left behind. In the last few years the government concentrated on economic side and, as a result of which, basic macro economic indicators have improved a lot," he claimed. The government''s intent is to sustain the high growth level, which it has achieved in recent years and for this purpose it wants to provide an environment that is conducive to investment and CBR is one of the important players in this regard.
"The government for the first time introduced reforms in the CBR and now we have to implement this change." To achieve such goals, the CBR is moving from self-assessment to ''universal self-assessment'' scheme, which is a historical change, meant for achieving transparency and efficiency. "But, it is just a beginning and we still have a lot of challenges ahead. The next financial year is the year of challenges for us as during this year we will have 13 RTOs where all facilities relating to income tax, federal excise and sales tax will be provided under one roof."
Similarly, the third Large Tax Payer Unit (LTU) will be established in Islamabad during the next financial year, he added.
Dispelling the impression that the role of tax professionals was being minimised, he said with the broadening of tax base their role would gradually increase, and added that CBR would not only look into the interests of the taxpayers but also of the tax professionals.
Chairman Income Tax Appellate Tribunal Khawaja Farooq Saeed said that now 20 tribunals of income tax were working on permanent basis across the country. He said the number of pending cases till December last stood at 18,000, which has been reduced to 11,956. Giving the break-up of pendency, he said at present 1,663 cases are pending in Islamabad, 8,495 in Lahore, 1792 in Karachi and 399 in Peshawar.
Member Direct Taxes Salman Nabi said that in 2003 the CBR had issued Rs 12 billion as refund while during this year the amount had risen to Rs 60 billion. According to him, completion of automated system in CBR will bring further improvement in working of the tax department. He said that in 2003 the CBR had issued 0.5 million NTNs while in 2004 the number soared to over 1.2 million. "We are increasing the number of tax payers at the ratio of 20 percent per annum under the voluntary compliance."
Regional Commissioner Income Tax Haji Ahmed, Collector Sales Tax Lahore Muhammad Nazim Saleem, LTBA President Sadiq Choudhry, Secretary General Ajmal Khan, Naeem Shan and others also spoke on the occasion.