The Federal Board of Revenue (FBR) has directed the Regional Tax Offices (RTOs) to register retailers, who have declared annual sales of Rs 5.0 million or more in their income tax returns with the sales tax department.
In a written reply, Minister for Finance Shaukat Tarin on Thursday informed the National Assembly that the FBR had asked the field formations to locate and register new taxpayers on the basis of shops with large covered areas, having high electricity/gas bills and retail outlets authorised to accept credit cards.
The FBR has also started legal proceedings against 445,849 NTN holders, who failed to file their income tax returns. The Regional Tax Offices have initiated legal proceedings against these non-filers after the last date of filing of returns. The FBR has decided to conduct survey of business and commercial locations to expand the tax net.
The areas focused for the next three to four years to broaden the tax base included land developers/housing schemes, ownership of property - through Local Registration Offices, ownership of vehicles - through Motor Registration Offices, vendors of various industries, withholding taxpayers, data matching with Nadra, survey of new business/commercial localities and electronic/print media support for the identification of probable tax payers.
He said the government had widened tax base by imposing Federal Excise Duty (FED) in sales tax mode on banking services in budget 2009-10. Other services brought into the tax net included port and terminal operators, stockbrokers, and insurance companies.
The FBR had utilised e-file data of withholding agents who deducted income tax from suppliers of goods @ 3.5%. FBR had sent list of 46,816 unregistered persons to various RTO/LTU on January 22, 2009, 41,053 unregistered persons on April 28, 2009 and 18213 on October 05, for registering them after issuance of requisite notice. Action was already underway on these lists by the field formations.
On May 28, 2009, the FBR also sent a list of about 4,100 unregistered buyers who bought goods above threshold of Rs 5.0 million which it obtained from 171 big units through e-mail. The FBR intended to expand this exercise to other big units. He said the enhancement of taxpayers base always remained main target of the FBR which was an ongoing process. The FBR had relied upon third party information for which data had been collected from various trade bodies as well as professional institutions.
The FBR had collected data from Excise Taxation officers for expensive vehicle registrations and the car manufacturers. Similarly, data of registration of immovable properties from land revenue authorities where Capital Value Tax was paid on the purchase of immovable assets had been obtained.
The FBR had also obtained information from the Securities and Exchange Commission of Pakistan (SECP)/Registrar of Companies to increase the number of existing companies on tax net. There was also increase of salaried taxpayers not on tax roll. To broaden the tax-base, assistance from Customs and Sale Tax Wings regarding importers, exporters, individuals and manufacturers had been sought, the finance minister added.