NA body concerned over increase in tax collection due to surge in imports

ISLAMABAD – National Assembly Standing Committee on Finance and Revenue on Wednesday has expressed concerns over the increase in tax collection due to the surge in imports, which was not positive indication with regard to broadening of tax net etc. 

The meeting of the National Assembly Standing Committee on Finance and Revenue was held yesterday in Committee Room No. 7, Parliament House, Islamabad, under the chairmanship of Faiz Ullah, MNA. Dr. Muhammad Ashfaq Ahmed, Chairman, Federal Board of Revenue, apprised the Committee about the overall performance of Federal Board of Revenue particularly refunds on both income tax and sales tax from 2008, to date. He explained the revenue collection trend which confirmed the growth in revenue collection, especially during the months of July and August, 2021. He further highlighted the refunds details from 2007-08 to 2020-21 and Income Tax pendency from 2008 to 2013, which was approximately Rs.323.8 billion. The chairman, FBR informed the Committee that the refunds of Sales Tax as on 22-09-2021 were pending due to Tariff differential. He was of the view that tariff differential policy need to be reviewed, moreover he emphasized the need of massive investment for infrastructure, particularity in IT sector in wake of recent Cyber Attack in FBR. He was also of the opinion that policy consideration regarding pending income and sales tax refunds prior to tax year 2020 required to be liquidated through TSG.

The FBR has also surpassed the first two months tax collection target by Rs160 billion. The FBR collected Rs850 billion in July to August period of the current fiscal year against the target of Rs690 billion, showing a growth of 41 percent. The FBR collection from Income tax was recorded at Rs254 billion in July-August period of the ongoing financial year as against the target of Rs208 billion. Sales tax collection remained at Rs410 billion in first two months of the year 2021-22 as compared to the target of Rs321 billion. The FED collection was recorded at Rs46 billion and Custom Duty at Rs140 billion in July to August period of the current fiscal year. 

The Committee members have expressed their concerns over the increase highlighted by the Federal Board of Revenue in revenue collection. The Committee noted that said increase of revenue growth was due to increase of price in import, which was not positive indication with regard to broadening of tax net etc. 

The Committee discussed the “The Security Exchange Commission of Pakistan (Amendment) Bill, 2020”, clause by clause, the Chairman Audit Oversight Board and other stakeholders were also present in the meeting. After threadbare discussion the Committee unanimously passed the Bill with some amendments. However, the Committee deferred the other legislative agenda due to short of time.

Article source: https://nation.com.pk/23-Sep-2021/na-body-concerned-over-increase-in-tax-collection-due-to-surge-in-imports