Federal Board of Revenue (FBR) may miss Rs 1.358 trillion target fixed for current fiscal year because of the incorporation of sales and income taxes. These views were expressed by several customs officials while talking to Business Recorder on Monday.
They said that the board has abolished administrations of sales tax/federal excise and income tax and made a single authority called Inland Revenue Service (IRS). They said the revenue collection, which was supposed to be increased after adopting "new innovative approach," had considerably declined by some Rs 2 billion in its inaugural month (January).
They expressed apprehension over the performance of income tax officials, saying that customs officers made around 75 percent of revenue collection, while income tax officers shared remaining collection. They said that IRS was mostly based on income tax officials, who had no expertise to deal with advance sales tax and federal excise procedures and termed the decision to comprise income tax officials in IRS as illogical.
They said that board has appointed Irfan Nadeem, member Direct Tax (DT) as member IRS and empowered him to deal with all entities including sales tax/federal excise and income tax, which raised several questions regarding the careers of customs officials.Customs staff has fears that this decision would create adverse impact on their careers, saying that the performance of the customs officials would not be highlighted in IRS because all credits would be relished by sales tax officials.
To a question, they said that income tax officials would not be capable to cope with sales tax and federal excise issues because of their inadequate skills and knowledge and added that customs officers were following highly professional approaches in this regard. They said the customs officers have completely been ignored in the decision-making process of IRS, which made its transparency and objectives questionable.
They showed concern over the decision of FBR in granting all powers to member IRS as unjustifiable, saying that the distribution of powers has created negative impact on the performance of other support members.
They said the customs, sales tax and federal excise are indirect taxes based on goods and services and added that the procedure to collect indirect taxes is completely different from income tax, which is a tax on income (not on goods and services).
When contacted, senior officials present in tax office dispelled the perception that IRS would create adverse impact on the careers of customs officials, saying that both direct and indirect tax collectors would perform same duties as they were doing before this decision. They said that Ahmad Waqar, chairman, FBR has resolved all grievances of customs officials, and ensured them not to amend the procedure of promoting any official and board would practice same exercise, which was carried in the past.