Over 3,000 firms reporting consistent losses

Report says country suffers Rs200 billion in losses due to tax concessions every year.

ISLAMABAD: Over 3,000 companies in various sectors are declaring losses for an extended period of time and 11,000 companies have been operating while showing zero income, according to a report published by the Federal Board of Revenue (FBR).

The report was prepared by the directorate of fiscal research and statistics.

The report added that the country suffers Rs200 billion in losses due to tax concessions every year. The loss is around three per cent of gross domestic product (GDP).

The concessions have been provided on necessities in the wake of floods to curb inflation. However, the report claimed that certain concessions are granted for political reasons and senior diplomats, bureaucrats and military personnel also get exemption from taxes.

The report states that 3,232 companies have been in the red for years at a stretch and questions must be asked about how the companies have managed to stay in business. Similarly, 11,813 companies have been stating zero revenue for a substantial period of time, the report said.

Published in The Express Tribune, October 8^th, 2010.