FBR delineates contours of Fiscal Year 2016 revenue

The budget preparation exercise (2015-16) kicked off here at the Federal Board of Revenue (FBR) with specific focus on measures meant for providing major relief to the general public during the next fiscal year. Sources told Business Recorder here on Saturday that the FBR House remained open on April 25 for initiating budget preparation exercise.
The first preliminary meeting of the budget (2015-16) at the FBR discussed broader guidelines of budget preparation exercise. The meeting was chaired by FBR Chairman Tariq Bajwa and attended by FBR team of budget makers. Primarily, it was discussed that a balance needs to be achieved between the taxation and relief measures to be proposed for new fiscal year. During meeting on Saturday, there was no specific discussion on fixation of revenue collection targets, but broader discussion was done on the budgetary measures pertaining to direct and indirect taxes.
The customs tariff proposals were mainly discussed to reduce the customs tariff in budget (2015-16). The government is finalizing the design of the new system to simplify the tariff structure to move over three years to a simple, transparent framework, with four slabs between 1 and 25 percent rates with fewer exceptions. For 2014-15, the FBR consolidated from seven tariff slabs to six. All items at 30 percent duty have been moved to a new maximum rate of 25 percent rate. The phase-in of the revised tariff rates and phase-out of trade SROs began in July 2014. The FBR is on track to further reduce tariff slabs to five and the next round of trade-related SRO elimination will start with the 2015-16 budget cycle.
The FBR is in the process of withdrawing over Rs 100 billion duties/taxes exemptions and concessions through Statutory Regulatory Orders (SROs) in the next budget (2015-16). Budget-makers will try to withdraw SROs of at least Rs 100 billion in the next budget, as SROs amounting to Rs 104 billion have been withdrawn during the current fiscal year. In the second phase of the plan, all residual concessions/ exemptions either in the SROs or Schedules except socially sensitive concessions will be withdrawn over the next year.
In budget 2014-15, a new Fifth Schedule was added to the Customs Act, 1969. The Parts-I, II and III of the said Schedule contain residual concessions and exemptions available earlier in the rescinded SROs 567(I)/2006 and 575(I)/2006, dated 5.6.2006. Concessions and exemptions available under SRO 565(I)/2006 were revisited and the same have either been withdrawn or maintained by reducing the extent of concessions. In accordance with the policy to phase out exemption notifications, a number of sales tax SROs were also withdrawn or amended in last budget.