Agriculture sector, bourses to be taxed within three years, National Assembly told

Minister of State on Finance Hina Rabbani Khar has said that the government would bring agriculture sector and stock exchanges into the tax net within the next three years under the plan to broaden the tax base. During question-hour session of the National Assembly here on Wednesday, she said that the government is committed to bring all potential sectors into the tax net.
The agricultural income would be taxed in the next three years by developing some mechanism between the federation and provinces. "Every sector, which is presently out of the tax net would be brought into the documented economy". Similarly, stock exchanges would also be brought into the tax net in the next three years.
She said that Pakistan has lowest tax-to-GDP ratio in the region for which the Federal Board of Revenue (FBR) is actively working on an enforcement plan for broadening the tax-base. The number of taxpayers has been doubled during the last four years from around 1.2 to 2.2 million since 2004.
The number of return filers is still very low as compared to the total population of the country. Most of the tax is being paid by the salaried class, which has been reflected in the employer''s statements submitted by government and private organisations. The FBR has started audit of the registered units to check payment of taxes through verification of tax records and returns filed.
She admitted that the administration of the FBR needs further improvement to end interaction between the tax department and the taxpayer. The face to face interaction between the two sides would be ended, but still it is a very big problem under the FBR administration. In this regard, the government is strongly pursuing the FBR to improve its administration through reforms. The government is also working on the incentive based system for the tax officials to reward tax officials showing outstanding performance, she added.
In a written replay, Minister for Finance Shaukat Tarin said that broadening of tax base is one of the major initiatives of the FBR that have resulted in the increase of tax payers substantially. It is also to be mentioned that the enhancement of tax base is a major target with respect to the ongoing reform process in the FBR. The FBR collects data of expensive vehicle registrations, from Motor Registration Authority besides using the data of car manufacturers/ importers.
The revenue authorities from where data of registration of immovable properties are collected, especially those persons who have paid Capital Value Tax on the purchase of immovable property. Under the same process, information is also obtained from Securities and Exchange Commission of Pakistan (SECP)/Registrar of Companies to update the number of existing companies on tax net.
He said that the information regarding the salaried individuals both from private and public sectors, with no national tax number is obtained to Note book them in the existing tax net. The sales tax department and customs, authorities services are also utilised regarding importers, exporters, industries and manufacturers that are not on the tax roll.
He further said that the field formations periodically hold workshops, seminars to make the general public aware of the legal obligation to fill return of income. Booklets, pamphlets published under the supervision of the Facilitation and Tax Education wing of the FBR are sent to the field formations for distribution among the tax payers and prospective tax payers.
The FBR provides help desk Kiosk at various business locations of all major cities to educate and help the taxpayers at spot in filing their income tax returns and to educate them about the relevant tax laws. Use of directories of trade bodies, chambers, newspapers advertisements, trade fairs and physical mapping of business areas to confirm the existence of persons on tax roll or required measures to book him as a taxpayer. The basic philosophy behind these measures is to make the general public aware of the legal obligation and to persuade them in a generally friendly and co-operative atmosphere, he added.