KPRA contributes 71% of K-P’s tax revenue

Himayatullah Khan, the Advisor to K-P Caretaker Chief Minister on Finance, Energy, and Power, visited the Khyber Pakhtunkhwa Revenue Authority (KPRA) office and expressed the need to expand the tax net. He pledged to make every effort to increase tax collection in the province. Accompanied by Secretary Finance Muhammad Ayaz, Khan received a detailed presentation from the Director General of KPRA, Shah Mahmood Khan, on the organization’s structure, functioning, revenue achievements, and proposed strategies moving forward.

The DG KPRA informed that KPRA had contributed 71% of K-P’s own source tax revenue in the financial year 2022-23. He highlighted the remarkable performance and dedication of the KPRA team, stating that revenue collection had increased by 180% since 2017. During the presentation, the DG KPRA also discussed the pending amounts owed to KPRA by the Federal Board of Revenue (FBR), National Transmission and Dispatch Company (NTDC), and Peshawar Electric Supply Company (PESCO).

These outstanding amounts require the efforts of the K-P government to facilitate their release. Regarding the pending amounts, it was revealed that under a memorandum of understanding (MoU) signed between KPRA and FBR, the FBR had paid Rs8 billion to KPRA for crossinput adjustment, while an additional Rs10 billion was pending. The advisor affirmed that the government would address the issue of the pending amount with the federal government. Furthermore, the DG KPRA highlighted the expansion of the tax base by including new sectors related to services businesses. He mentioned that when KPRA was established, 93% of the tax was collected from the telecom sector.

However, this percentage has now decreased to 35% due to the inclusion of other sectors. The KPRA team has been actively exploring these sectors, resulting in a more diversified tax base. During his address, Advisor Himayatullah Khan commended the efforts of the KPRA team and stressed the importance of broadening the tax base by including more sectors. He explained that by expanding the tax net, it would be possible to lower tax rates without compromising revenue collection. Khan acknowledged that KPRA plays a crucial role in generating revenue for the province, which is then utilized for public uplift programs aimed at improving the lives of the people.

The advisor urged the KPRA team to identify growth potential in sectors that do not burden the poor population of the province. He mentioned sectors such as oil and gas exploration, infrastructure development cess, and security services as areas where there may be potential for increased revenue collection.