Cantonment cutbacks: Rawalpindi drowning in red

RCB fails to collect over Rs500m in taxes, owes over Rs3.5 billon to Khanpur Dam

RAWALPINDI:

The cash-strapped Rawalpindi Cantonment Board (RCB) has started laying off employees after failing to collect back taxes.

“The board has been facing financial problems due to delinquent taxpayers,” RCB Executive Officer Dr Saima Shah said at a media briefing.

Dr Shah said that the board had to collect over Rs500 million in taxes, with some payments pending since 1999. She said that the list of defaulters contains many prominent businesses, owners of plazas in the cantonment area.

The executive officer noted that much of the amount had been tied up due to court cases or requirements for fresh assessments.

Dr Shah said that the board had asked the defaulters to pay 25 percent of the total dues to avoid legal action. She said that the board had started sealing the properties of the defaulters. The drive against defaulters is in full swing and she would not bow to any pressure.

She said that in the second phase, the focus would be on major tax defaulters.

Some 3,000 housing units in RCB were still out of the tax net. These units could not be included in the tax net for the last six to eight years.

She added that the board had formed two assessment committees to bring more units in the tax net.

In response to a question, she said around 66,000 units were presently in the tax net.

Elaborating on the financial crisis at the board, the Shah, who took charge of her office six months ago, said that RCB’s annual budget deficit was Rs250 million. She said that every year the Punjab government paid the board Rs150 million to run its affairs.

She said that the board spent Rs7.5 million on salaries and pensions.

Of the 2,200 board employees, 850 had been declared surplus. The board has decided to gradually lay off the surplus employees and retain qualified and hardworking employees.

Apart from unpaid taxes, she also highlighted that Rs3.5 billion was payable to the Khanpur Dam due to the board’s inability to make regular payments. She added that the RCB had to pay Rs10 million every month for maintenance of Sangjani Water Treatment Plant.

Published in The Express Tribune, March 11^th, 2016.