ISLAMABAD-The Senate body on Finance and Revenue has summoned high-ups of Federal Board of Revenue on Thursday (April 10) to explain the details of tax relief worth Rs 320 billion given to business community during seven months (July-January) of the ongoing financial year.
The Senate Standing Committee on Finance and Revenue, which will meet tomorrow, has asked the FBR to provide details regarding Rs 320 billion tax relief given to the business community during July-January 2013-2014. Similarly, the committee has asked the tax officers to inform it (Senate body) on the impact of tax relief on the country’s economy, specifically on revenue collection.
The parliamentary committee also directed the FBR to brief on the commitment made with International Monetary Fund (IMF) regarding tax system of the country. The tax department would also inform on the revenue collection of the Federal Board of Revenue during so far period of the ongoing financial year.
It is worth mentioning here that government is struggling to achieve the annual tax collection of the country, as it might miss the target by huge margin of Rs 200 billion by the end of June 30 2014. The Federal Board of Revenue (FBR) has accumulated Rs 1575 billion during nine months (July-March) of the current fiscal year. The tax collection shortfall is around Rs 105 billion in the aforesaid period.
Therefore, the economic experts view that FBR’s collection would hardly reach Rs 2250-2275 billion during ongoing financial year 2013-2014, leaving shortfall at over Rs 200 billion.   Meanwhile, according to the notice issued by the Senate Standing Committee on Finance and Revenue, the FBR would also brief on tax to GDP ratio currently compared to the last year and borrowing from the State Bank of Pakistan during ongoing year over last year mainly due to the shortfall in tax collection.
The Senate body also sought details on government’s initiative to increase the tax net, amnesty scheme announced by the government, tax exemptions and impact of these schemes on the revenue collection of the government.  The committee also sought details on Afghan Transit Trade rules shortcomings under WeBoc and the impact on ATT as a result. Similarly, it has asked for the conclusive report on the investigation of s 40 billion tax refund scam and Federal Investigation Agency (FIA)’s involvement in it.