FY21: It's lower tax collection in dollar terms, says expert
- Former special assistant to the prime minister on revenue Haroon Akhtar says if we convert revenue collection in dollars, the current regime is still far behind compared to collection during 2018
ISLAMABAD: Former special assistant to the prime minister on revenue Haroon Akhtar has said that the Federal Board of Revenue (FBR) tax collection of Rs4.7 trillion in 2020-21 in dollar terms is US$29.5 billion against US$35 billion (Rs3.842 trillion) in dollar terms in 2017-2018.
Speaking as a guest at Aaj TV programme, "Paisa Bolta Hai" with Anjum Ibrahim, Akhtar said that if we convert revenue collection in dollars, the current regime is still far behind compared to collection during 2018.
The FBR's revenue collection is 20 percent less in dollar terms in 2020-21 when compared with 2017-2018. Akhtar said that the FBR's performance is measured on two counts. First, the FBR's tax-to-GDP ratio, which was 11.3 percent in 2017-2018 and came down to 9.80 percent last year despite, collection of Rs4.7 trillion in 2020-21.
Second, the imports have almost doubled during the first two months of 2021-22 against July-August (2020-21) and 50-52 percent taxes are withheld at the import stage. This means that the growth in revenue shown in July-August (2021-22) is primarily due to doubling of imports.
He said that the government has promised in the last budget that no notices would be issued and the audit would be conducted of only those cases selected for audit on a random basis through computer balloting. Contrary to this, notices are frequently issued to the taxpayers like before in 2020-21, he regretted.
FBR surpasses FY2020-21 tax collection target
There is zero progress on the matter of third-party audit to be given to the chartered accountant companies, despite passage of two months.
Former SAPM on Revenue said that the FBR has the ability to collect data from any source such as immigration, banks, travelling data, real estate authorities, and utility agencies.
The FBR should make a program for utilisation of data because it has to be done by the FBR and not the NADRA.
He added that 70 percent of the imports from China are at zero percent duty to five percent duty due to the Free Trade Agreement (FTA) with China. This would have a very negative impact on the domestic industry and industrialisation.
Tax lawyer Waheed Shahzad Butt stated that it is extremely necessary that access to financial data should be available to the Revenue Division.
Recently, hackers attacked the FBR's database, but effective measures are needed to secure the classified data of the taxpayers to avoid its leakage.
The FBR should ensure internal accountability and take action against tax officials involved in corrupt practices. About 95 percent of the complaints filed with the Federal Tax Ombudsman (FTO) are related to the refunds, Waheed Shahzad Butt added.
Tax expert Dr Ikramul Haq said that the FBR is maintaining its data from a private limited company i.e., Pakistan Revenue Automation Limited (PRAL). The data security protocols should be placed by a third party for data protection.
Copyright Business Recorder, 2021
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