Revenue board: Blame game begins with fall in tax revenues
FBR has missed first-quarter collection target by Rs56 billion
CREATIVE COMMONS
ISLAMABAD:
As tax revenues keep falling, infighting has erupted in the Federal Board of Revenue (FBR) to shift the blame on to each other.
A fresh move has been launched to remove Dr Mohammad Irshad, Member Operations of the FBR, who is responsible for the collection of inland revenues, said sources on Monday.
Irshad has recently been promoted to grade-22, the highest grade in the civil service structure.
The move comes amid a continuous decline in revenue collection. After missing the first quarter’s target by Rs56 billion, the FBR is facing a gigantic task to collect Rs260 billion in the current month.
By October 17, the tax authorities had collected Rs94 billion, which was about 38% less than the collection until the same day in the previous fiscal year. They need to collect another Rs166 billion in the remaining 13 days.
If the FBR wants to stay on course to meet the annual target of Rs3.621 trillion, it will have to generate more than Rs260 billion this month to make up for the shortfall.
Sources said higher authorities were putting the blame on the member operations for the dip in revenues, which the member was not ready to accept.
Finance Minister Ishaq Dar on Monday called the entire top hierarchy of the FBR in his office to find out the reasons behind the shortfall in tax collection and devise a future strategy. The meeting ended inconclusively.
Earlier, an attempt was made to replace FBR Chairman Nisar Mohammad Khan along with Irshad. However, sources said Irshad had the backing of Special Assistant to Prime Minister on Revenue Haroon Akhtar Khan.
Talking to The Express Tribune, Khan denied that there was any such move to transfer Irshad.
However, sources said the government was considering replacing him with Chaudhry Safdar, Chief Commissioner Large Taxpayers Unit (LTU) Lahore or Khawaja Tanveer, Director General of Intelligence and Investigation of Inland Revenues.
Changes introduced
Last week, the FBR introduced administrative changes in the second tier and replaced over half a dozen chief commissioners of Regional Tax Offices and LTUs. However, the LTU Karachi-I chief commissioner was not replaced, though he had missed the quarterly target by Rs35 billion.
The LTU Islamabad chief commissioner was replaced who had missed the target by Rs22 billion. He told the high-ups that the first-quarter target was missed due to hefty advances the FBR had taken to meet the tax target in the last fiscal year. The FBR had claimed that it collected Rs3.112 trillion against the target of Rs3.104 trillion.
Later on, it was revealed that the FBR had taken about Rs250 billion in advances in addition to blocking taxpayers’ genuine refunds.
FBR people said the collection was adversely affected this year due to the advance taken last year, the grant of zero-rating tax facility to five export-oriented sectors and partially withdrawing the higher tax rates on petroleum products.
This is despite the fact that the government is still charging 37% sales tax on high-speed diesel against the standard 17%.
Published in The Express Tribune, October 18th, 2016.
As tax revenues keep falling, infighting has erupted in the Federal Board of Revenue (FBR) to shift the blame on to each other.
A fresh move has been launched to remove Dr Mohammad Irshad, Member Operations of the FBR, who is responsible for the collection of inland revenues, said sources on Monday.
Irshad has recently been promoted to grade-22, the highest grade in the civil service structure.
The move comes amid a continuous decline in revenue collection. After missing the first quarter’s target by Rs56 billion, the FBR is facing a gigantic task to collect Rs260 billion in the current month.
By October 17, the tax authorities had collected Rs94 billion, which was about 38% less than the collection until the same day in the previous fiscal year. They need to collect another Rs166 billion in the remaining 13 days.
If the FBR wants to stay on course to meet the annual target of Rs3.621 trillion, it will have to generate more than Rs260 billion this month to make up for the shortfall.
Sources said higher authorities were putting the blame on the member operations for the dip in revenues, which the member was not ready to accept.
Finance Minister Ishaq Dar on Monday called the entire top hierarchy of the FBR in his office to find out the reasons behind the shortfall in tax collection and devise a future strategy. The meeting ended inconclusively.
Earlier, an attempt was made to replace FBR Chairman Nisar Mohammad Khan along with Irshad. However, sources said Irshad had the backing of Special Assistant to Prime Minister on Revenue Haroon Akhtar Khan.
Talking to The Express Tribune, Khan denied that there was any such move to transfer Irshad.
However, sources said the government was considering replacing him with Chaudhry Safdar, Chief Commissioner Large Taxpayers Unit (LTU) Lahore or Khawaja Tanveer, Director General of Intelligence and Investigation of Inland Revenues.
Changes introduced
Last week, the FBR introduced administrative changes in the second tier and replaced over half a dozen chief commissioners of Regional Tax Offices and LTUs. However, the LTU Karachi-I chief commissioner was not replaced, though he had missed the quarterly target by Rs35 billion.
The LTU Islamabad chief commissioner was replaced who had missed the target by Rs22 billion. He told the high-ups that the first-quarter target was missed due to hefty advances the FBR had taken to meet the tax target in the last fiscal year. The FBR had claimed that it collected Rs3.112 trillion against the target of Rs3.104 trillion.
Later on, it was revealed that the FBR had taken about Rs250 billion in advances in addition to blocking taxpayers’ genuine refunds.
FBR people said the collection was adversely affected this year due to the advance taken last year, the grant of zero-rating tax facility to five export-oriented sectors and partially withdrawing the higher tax rates on petroleum products.
This is despite the fact that the government is still charging 37% sales tax on high-speed diesel against the standard 17%.
Published in The Express Tribune, October 18th, 2016.