The Federal Board of Revenue (FBR) has decided to convene a Withholding Tax Commissioners' Conference on December 20, 2016 to chalk out a comprehensive plan for improving withholding tax collection in remaining period of 2016-17 to overcome the revenue shortfall through withholding taxes.
Sources told Business Recorder here on Saturday that the FBR has issued instructions to field formations to suggest measures and recovery plan for increasing withholding tax collection in the remaining period of current fiscal year. The withholding taxes contributed a major chunk ie around 68-70 per cent to the collection of direct taxes in 2015-16. The nine major components of withholding taxes that contributed around 85 per cent to total WHT collection are contracts, imports, salary, telephone, export, bank interest/securities, cash withdrawal, dividends and electricity in 2016-17.
The agenda of the upcoming conference included in-depth analysis of withholding taxes by the regional tax offices (RTOs). Analysis included updated stock position of withholding agents specifying the category; whether withholding statements are filed by agents, if not action taken so far along with amount of penalty and number of orders passed thereof, and whether the tax is being deducted as per prescribed rates and deposited timely.
Field formations would inform FBR the number of orders passed u/s 161/205 of the Income Tax Ordinance in case of default by the withholding agents; analysis of major withholding sections of the RTO. In case of reflecting growth; how to further maximise them. In case of negative trends, how to reverse the situation for improving collection?
The RTOs would share the mechanism for the enforcement, monitoring & verification of various withholding provisions regarding filers/non filers; month-wise collection out of current and arrear demand created u/s 161/205 and implementation of newly introduced withholding sections along with revenue impact.
The FBR has also asked the field formations to specify any special initiative taken in withholding taxes which can be shared with other RTOs as "best practices" and strategy to monitor withholding taxes in the next quarter.
On the sales tax side, the commissioners will brief the FBR on the updated stock position of WHT Agents; salient features of the ST withholding regime of the RTO; cross matching exercise between WHT statements (income tax) filed by companies and sales tax return and number of default cases, demand created and collected during the current quarter (October-December) 2016-17.
The FBR has further directed Chief Commissioners to nominate a senior most Commissioner Inland Revenue (CIR) to represent LTU/RTO concerned for making a presentation in respect of withholding taxes at the conference.
Comments
Comments are closed.