'Government expects growth of 17 percent to 18 percent in tax collection'

The government is likely to collect Rs 4.8 to Rs 4.9 trillion in revenue through various taxes during 2019-2020, if tax collection in final two quarters of the financial year witnessed sufficient growth.

This was stated by the Federal Secretary (Finance), Naveed Kamran Baloch, while briefing the Public Accounts Committee (PAC) meeting held here under the chairmanship of Rana Tanveer Hussain. The secretary said that the government was expecting a growth of 17 to 18 percent in tax collection during the ongoing financial year.

He added that the government had targeted Rs 2.9 trillion payment for debt servicing.

Briefing the panel the Auditor General of Pakistan (AGP), Javed Jahangir, revealed that owing to the ill planning of the finance ministry Rs 411 billion could not utilized on various projects, while on the other side, the government also came out with a mini budget.

The PAC chairperson and other members, while expressing grave concern over the ill planning of the government, said that as a result of flawed policies of the Ministry of Finance the inflation rate had reached 10-year high at 14.6 percent.

The finance secretary said that so far up to 16 to 17 percent increase had been made in tax collection, while non-tax revenue collection had also witnessed an improvement and the authorities were making efforts to further improve tax collection.

Member Committee Khawaja Asif, while responding to the secretary finance, remarked "please stop befooling the masses in the name of improving the tax collection in the last quarter of the financial year."

He said that the Ministry of Finance during the past 70 years kept on showing improvement in revenue collections in the final quarter of financial year by showing an increase in tax refunds and advance tax collection.

The finance secretary said that if the committee wanted to get further information on revenue collection it would be better to direct the Federal Bureau of Revenue (FBR) to brief the panel on the tax collection targets and the present situation.

Responding to another question raised by Khawaja Asif and Sardar Ayaz Sadiq, the secretary finance said that dealing with matters related to portfolio investment was the mandate of the State Bank of Pakistan (SBP).

Khawaja Asif said that the panel must summon the State Bank of Pakistan (SBP) governor to inquire about the latest position of portfolio investment in the country, and the people involved in the hot money investment.

He said that the people involved in portfolio investment at present were making huge profits, saying only drug smugglers make such hefty profits not common businessmen.

Ayaz Sadiq said that portfolio investment in May 2019 was $1.9 billion, which now had crossed $3 billion mark, which at present was the major source of foreign reserves buildup.

Briefing on the state of foreign reserves of the SBP, the secretary finance said that at present the central bank had $12.5 billion.

Following a detail discussion, the PAC allowed the AGP to review audited accounts of the Pakistan Engineering Council (PEC).

He said that the National Database and Registration Authority, Islamabad Gun Club, Pakistan Medical and Dental Council, the Securities and Exchange Commission of Pakistan, and some other state institutions created through acts of parliament did not allow the AGP to conduct the audit of their accounts.

Javed Jahangir informed the panel that the financial accounts of the AGP would be audited by an external auditor.

He said that those institutions that declined to the audit were taking plea that they were not getting funds from the government; hence the AGP had no authority to conduct their audit.

The AGP further said that the National Bank of Pakistan was also not willing to be audited and the bank authorities had got a stay order from a court of law in this regards four years ago.

The AGP officials said that some public sector organizations had not allowed the AGP to conduct the audit of their accounts, adding that the 18th Constitutional Amendment had empowered the AGP to conduct audit of all the state institution including provincial departments.

The AGP, in his briefing, said that as per the law, it was mandatory for all the state institutions to provide the details of their financial accounts to the AGP for audit, adding that the Supreme Court of Pakistan had also given a ruling in this connection.