Central Board of Revenue (CBR) has achieved the target of Rs 265 billion set for current fiscal year under the head of indirect taxes in the first three quarters while overall target of Rs 835 billion revenue collection fixed for the year 2006-07 will be achieved.
Member Direct Taxes CBR Salman Nabi stated this while addressing a pre-budget seminar organised by Association of Chartered Certified Accountants (ACCA) with the theme of "striving towards a more equitable Pakistan" here at a local hotel on Thursday.
Among others, Arif Masud Mirza, head of ACCA Pakistan, Muhammad Arshad, head of Internal Audit and Taxation, First Fidelity Leasing Modaraba, Irfan Ilyas, partner, Ilyas Saeed & Co, and former LCCI president Yawar Irfan also spoke on the occasion.
Salman Nabi maintained that CBR had evolved a comprehensive 'audit system' to net the hidden amount of taxes strictly in accordance with rules and procedure. He said that they had picked around 24,000 returns for audit purpose but matter went into litigation. Now the Supreme Court has given go ahead to carry out audit of selected returns, he added.
'We are working on scientific lines and have established the best administrative structure for revenue collection,' he said, adding taxpayers are now not scared of tax officials, which speaks our success story. During the last less than three years, refunds worth Rs 90 billion had been issued and now the figure of refunds is in single digit, he said. 'CBR is going to evolve a comprehensive system under which the refund would be automatically transferred to the taxpayer's bank account', he added.
Salman Nabi further said that joint efforts were needed on the part of both taxpayers and tax officials to create a sense of understanding among the two sides.
He also said that CBR has computerised the database of taxpayers while we are achieving the growth of 20 percent in the number of taxpayers. 'CBR has also stored CNIC data of about two million people which is being used for different purposes', he added.
He further said that National Automated Collection System (NACS) has been introduced in the country for collection of revenue. "We are very much on the track and taking steps in the right directions. We have tried to bring about positive change in the mindset, in approach and in rules and procedure, with a view to facilitating the taxpayers and to convince them to file returns on voluntarily basis", he said.
"We are doing our best to bring visible improvement in tax department and after enforcement of Universal Self-Assessment Scheme (USAS) there is constant increase in number of taxpayers. He said the government was also laying much emphasis on improvement of technology and human resource development to meet the future challenges. He added that taxation staff was being motivated and special salary package had been approved for them.
Salman Nabi further said that Pakistan needed high growth rate on sustained basis for achieving desired goal of economic progress and prosperity. "For this purpose, high investment both by local and foreign investors, is required," he said.
During the last couple of years, he said, government has been able to maintain the take off level of economy, which is evident from improvement in growth level.
He said that fruitful results of government steps introduced in CBR have started appearing. The attitude of tax officials has changed now and taxpayers could approach them without any feeling of fear and harassment, he added. To a question, he said process of reforms in CBR is continuing, while tax laws have been simplified for the benefit of taxpayers.
Talking about ADTA (Avoidance of Double Taxation) he said that they had already reviewed it with 54 countries while Japanese and the US officials are due here for discussions over it. He further said that CBR has data of transaction of properties being made in Karachi. Out of compiled data, it reveals that 53 percent among those who sold and purchased properties are not taxpayers.
Speaking on the occasion, Arif Masud Mirza, Head of ACCA Pakistan submitted its budget proposals to the Central Board of Revenue. ACCA Pakistan's recommendations focus on a fair tax regime having fair direct taxes, indirect taxes, environmental taxes, social security system as well as mechanisms to develop tax culture, he said.
In order to sustain the high level of investment rates experienced in the past and to attract foreign investment in the country, ACCA Pakistan proposed a reduction in the flat 35 percent corporate tax rates. As compared to other countries in the region (Afghanistan: 20 percent, Bangladesh: 20 percent, China: 33 percent, India: 33.66 percent, Indonesia: 30 percent, Malaysia: 28 percent) Pakistan does have considerably high corporate tax rates.
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