Broadening tax base: 15m names with NADRA, 7.2m with FBR in hand: Tarin

KARACHI: Federal Minister of Finance and Revenue Affairs Shaukat Tarin said the government is trying to broaden the tax base and got as many as 15 million profiles including unregistered voters with Nadra and 7.2 million names with the FBR. The authorities are now in a position to tell 80 to 90 percent accuracy of their income levels with the help of technology and how much tax they should pay.

Addressing the business community on his visit to the Overseas Investors Chambers of Commerce and Industry (OICCI) and the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Tarin said, "We are using the data of individuals from various sources such as electricity bills, telephone bills, deposit data and travel, etc. We have identified profiles of the customers and unregistered voters - 15 million names with National Database and Registration Authority (Nadra) and 7.2 million names with Federal Board of Revenue (FBR) through artificial intelligence and comparing it with the behavior of the registered taxpayers.

"Now, who is going to knock the door? The FBR is going to knock the door?. A general perception is that the FBR is harassing individuals over tax-related matters. In order to end this perception, we would seek services of 1,500 professionals from the Institute of Chartered Accountants of Pakistan (ICAP) for the audits. Defaulters would be sent messages and reminders to pay taxes and if they failed to do so, action would be taken against them as per the law," he added.

"No representation, without taxation," he said, elaborating that an individual can not represent this society, unless he contributes his due share of tax to the exchequer.

He said the Economic Advisory Council has identified as many as 14 areas, including industry, agriculture, CPEC and energy, etc. He said that after 1972, economic planning was abandoned as the Planning Commission was dismantled resultantly the country lacked effective long-term and medium-term plans.

While acknowledging the rise in inflation, Tarin said the country has become the net importer of food now and the failure to focus on the agriculture sector had also contributed to the problem. The government is well aware of the situation, that is why administrative and market measures are being taken besides improving infrastructure of agriculture sector.

Broadening tax base: FBR, Nadra chalk out plans: Tarin

"We took business community's recommendations seriously and tried our best to incorporate them as much as we could under the framework of ongoing IMF programme. I have taken a stance with the IMF for not imposing taxes. We avoided taxes up to Rs 700 billion despite the IMF asking us to do so. But a few things were already implemented though a Presidential Ordinance before I assumed office against which the country received $500 million from the IMF. They asked us to enhance power tariff, but we responded them that we would find out alternate ways other than enhancing power tariff."

The minister sought constructive suggestions from the business community.

He said that regime change in Afghanistan is a great opportunity for Pakistan. It will help Pakistan to have an easy access to Central Asian markets.

He said that a board is being constituted in order to manage 10 to 15 high loss making State Owned Enterprises (SOEs) and then to privatise them. He vowed to ensure the FPCCI's representation in the board.

Tarin promised to consult the FPCCI every quarter now and onwards to resolve business issues efficiently and restore their confidence to promote private sector investment. He also announced that the FBR will set up a help desk at FPCCI head office in Karachi to facilitate resolution of discrepancies and issues in tax procedures.

Tarin stated that all currently issued notices will be withdrawn to put an end to the harassment of the FBR and corruption; and now onwards, notices will be issued by third party auditors after due diligence. He also promised that an FPCCI nominee will be inducted into all decision-making committees and boards of the federal ministries including the Privatization Commission and the FBR as the government realizes the FPCCI role as the apex body and its active participation is warranted in all policymaking forums.

Khawaja Shahzeb Akram, SVP FPCCI, raised the issue of no relief to common man because of inflation that continues to remain at a very high level, ie, 13% despite incessant hue and cry from all stakeholders.

He added that the SBP should bring down the interest rate to provide some breathing space to businessmen.

Tarin said the SBP is autonomous and he cannot dictate them on policy rate. He added that as the core inflation remains at 7%, he does not see a downward revision in the policy rate anytime soon.

Addressing the concerns over simplification of tax filing form and sales tax refunds, he advised the FBR chairman to have a consultative meeting with the FPCCI team and make necessary revisions to the form; whereas on sales tax returns, he said the Ministry of Finance has cleared most of the backlog and remaining refunds will be cleared soon. At the start of the meeting, participants offered Fateha for deceased business leader and a former president of FPCCI, Tariq Sayeed.

Copyright Business Recorder, 2021