NADRA to share data of the affluent with FBR

FBR will use the data to find out if individuals have paid taxes or are evading them.

ISLAMABAD: In a bid to broaden the tax net, the Federal Board of Revenue (FBR) has decided to acquire data of affluent individuals from the National Database and Registration Authority (NADRA).

FBR will also use the data acquired to send notices to question businessmen and industrialists and other high net-worth individuals about their sources of income and will ask them to disclose the expenditure that they incur. FBR will evaluate whether they have paid all the taxes applicable based on the information they provide or they are evading taxes.

In the light of the income tax ordinance, FBR is empowered to ask NADRA or any other organisation to provide it with required data. NADRA has been asked to provide data about people residing in Islamabad’s posh localities, so that property tax could be imposed on them.

Sources said that such steps on the part of FBR will increase the tax-to-GDP ratio by 0.5 per cent and will help collect additional taxes amounting to billions of rupees. It will also help the tax authority nab tax evaders and defaulters. However, critics are of the view that FBR will have to bear a heavy cost in terms of charges to be paid to NADRA. Section 176 of the income tax ordinance grants vast powers to FBR when it comes to acquiring data from NADRA, National Electric Power Regulatory Authority, Oil and Gas Regulatory Authority, Pakistan Telecommunication Authority and other organisations allowing the tax machinery to seek data free of charge. However, NADRA officials are of the opinion that their rules do not allow them to share information and even if they have to at times it can only be done by charging the recipient for it.

Published in The Express Tribune, January 15^th,  2011.