ISLAMABAD - The Federal Board of Revenue (FBR) would propose the government to increase the withholding tax for the non-filers in every sector in the forthcoming budget 2015-15 in a bid to broaden the extremely low tax base of the country.
Sources aware of the budget making process informed The Nation that FBR asked the government to tighten the noose around the non-tax filers in next budget.
The government is likely to increase the registration fee on the vehicles for the non-tax filers in budget to be announced on June 5, 2015.
They informed that government has asked the FBR to consult the provinces on one of the budget proposal to purchase urban land at about 25 per cent over and above rates declared in transfer deeds in order to stop tax evasion. “The government will implement the proposal if provinces express their willingness on it”.
According to another tax proposal, the FBR has asked the government to impose five percent surcharge on the higher income contributor who earn more than Rs 20 million annually in order to rehabilitate the Temporarily Displace Persons of the operation Zarb-e-Azb.
The government is also contemplating to enhance the sales tax on the import of mobile phones in the upcoming budget.
The government is likely to increase the sales tax on the import of low price mobile phones from Rs 150 to Rs 300, on medium price mobile from Rs 250 to Rs 500 and on smart phone to Rs 1000 from existing Rs 500.
The government has decided that the computerised national identity card numbers would be declared as National Tax Numbers (NTNs) for the tax purposes.
The government has set revenue collection target at Rs 3100 billion for the upcoming fiscal year, which would be 19 percent higher than expected collection of Rs 2605 billion of the outgoing financial year 2014-15. Additional revenue, over and above the current fiscal target of Rs2605 billion, would have to be met through other measures and the withdrawal of tax exemptions.
The government would withdraw tax exemptions worth of Rs 103 billion in the budget 2015-16, as it did in the previous budget.
Similarly, the government would impose new taxes worth of Rs 100 billion in the upcoming budget.
The government has estimated to raise Rs 300 billion for the next financial year due to the inflation and economic growth (combined 11.5 percent).
The finance ministry has projected growth in the rate of inflation at 6 percent in the FY2015-16 and expects the economy to grow by 5.5 percent.