Large Taxpayers Unit (LTU), Karachi, is all set to conduct annual audit to meet the target of Rs 122 billion fixed for current fiscal year 2008-09. Official sources in LTU told Business Recorder on Friday that the Federal Board of Revenue (FBR) has allowed annual audit aimed at facilitating the tax department to achieve the set target of Rs 1.2 trillion.
They said that FBR has increased its collection target by around 34 percent, which was earlier Rs 90 billion in previous fiscal year, adding that LTU could face hardships in achieving the set mark without auditing.
Sources said that several tax heads have been transferred to Regional Tax Office (RTO), creating negative impact on LTU collection. They said that LTU had collected Rs 3 billion on account of withholding tax in last corresponding period. However, in current period, LTU has so far collected Rs 1.5 billion, and added that the department could have collected over Rs 2 billion more if the tax heads had not been transferred to RTO.
Moreover, they said, the LTU collected around Rs 7 billion on account of Workers Provincial Provident Funds (WPPF) in last fiscal year 2007-08, which is presently being collected by the Ministry of Labour. They added that the LTU would face approximately Rs 3 billion shortfall on account of import duty, after removal of exception certificate.
Keeping all these issues in view, the LTU is pondering to conduct desk audit of all 720 corporate entities, which would definitely facilitate the department in meeting its set target, they said.
They said that the LTU has taken stern budgetary measures aimed at achieving set mark for current FY 2008-09 successfully. Hence it is covering those areas which had escaped taxes for various reasons. They said that LTU would scrutinise all financial books of all corporate entities, helping the department to find some assessments for audit.
They expected some Rs 14 billion aggregated collection shortfall due to aforementioned reasons would be covered through audit and hoped that this action would pave the way to achieve the tax collection target for current fiscal year 2008-09.