Revenue boosting steps bearing fruit, says govt
Tax collection grows 25% to Rs114b in December so far.
Against Rs91.5 billion collection in the first 20 days of December last year, the FBR received Rs114 billion this December, showing a 25% growth. CREATIVE COMMONS
ISLAMABAD:
The government has stressed that the steps taken to improve tax revenues have started showing results, a remark that comes in the backdrop of calls made by the International Monetary Fund for adopting a more ambitious approach to plug loopholes in the tax machinery and the laws.
Following the IMF’s Executive Board meeting that cleared second loan tranche of $553 million for Pakistan but raised concern over weak tax administration and depleting foreign currency reserves, Finance Minister Ishaq Dar called a meeting of economic managers to take stock of the situation.
He reviewed the implementation and progress made so far on the reforms and economic targets set by the PML-N government.
Federal Board of Revenue Chairman Tariq Bajwa briefed the minister on the tax collection and tax administration plan. Against Rs91.5 billion collection in the first 20 days of December last year, the FBR received Rs114 billion this December, showing a 25% growth.
It needs to achieve 28% growth to hit this year’s Rs2.475 trillion tax target. Overall growth in the first five months stood at 17%.
Bajwa said tax returns filed this year totalled 814,981 as compared to 744,866 last year.
“The finance minister expressed satisfaction over the pace of reforms and urged officials to redouble their efforts to achieve the targets,” the finance ministry said in a statement.
Contrary to this, the IMF executive directors suggested that Pakistan needed to do a lot more. “A more ambitious approach is needed to improve tax administration and eliminate loopholes,” said a statement issued by the IMF after its board meeting on Thursday.
The lender has asked the government to frame and submit a plan by the end of December for withdrawing the Statutory Regulatory Orders (SROs) under which tax exemptions have been granted to the affluent. It is also seeking a comprehensive plan to plug loopholes in tax administration.
First, such SROs will be identified and then they will be withdrawn through an Act of parliament. The government plans to scrap these exemptions from July next year.
“Work on identifying the SROs and preparing a plan to improve tax administration is on track and will be completed by December 31,” Bajwa told The Express Tribune.
Some of the IMF board members also expressed concern over the tax amnesty scheme announced by Prime Minister Nawaz Sharif recently, according to sources.
Finance Ministry Adviser Rana Asad Amin briefed the finance minister on the progress made so far on the planned issue of sovereign bonds, efforts to streamline and increase remittances and likely improvement in foreign exchange reserves, which would have a favourable impact on the value of the rupee.
The Ministry of Finance has opened the bids invited to shortlist consultants for floating a $500 million Euro bond. The consultant is expected to be appointed next week.
Published in The Express Tribune, December 21st, 2013.
The government has stressed that the steps taken to improve tax revenues have started showing results, a remark that comes in the backdrop of calls made by the International Monetary Fund for adopting a more ambitious approach to plug loopholes in the tax machinery and the laws.
Following the IMF’s Executive Board meeting that cleared second loan tranche of $553 million for Pakistan but raised concern over weak tax administration and depleting foreign currency reserves, Finance Minister Ishaq Dar called a meeting of economic managers to take stock of the situation.
He reviewed the implementation and progress made so far on the reforms and economic targets set by the PML-N government.
Federal Board of Revenue Chairman Tariq Bajwa briefed the minister on the tax collection and tax administration plan. Against Rs91.5 billion collection in the first 20 days of December last year, the FBR received Rs114 billion this December, showing a 25% growth.
It needs to achieve 28% growth to hit this year’s Rs2.475 trillion tax target. Overall growth in the first five months stood at 17%.
Bajwa said tax returns filed this year totalled 814,981 as compared to 744,866 last year.
“The finance minister expressed satisfaction over the pace of reforms and urged officials to redouble their efforts to achieve the targets,” the finance ministry said in a statement.
Contrary to this, the IMF executive directors suggested that Pakistan needed to do a lot more. “A more ambitious approach is needed to improve tax administration and eliminate loopholes,” said a statement issued by the IMF after its board meeting on Thursday.
The lender has asked the government to frame and submit a plan by the end of December for withdrawing the Statutory Regulatory Orders (SROs) under which tax exemptions have been granted to the affluent. It is also seeking a comprehensive plan to plug loopholes in tax administration.
First, such SROs will be identified and then they will be withdrawn through an Act of parliament. The government plans to scrap these exemptions from July next year.
“Work on identifying the SROs and preparing a plan to improve tax administration is on track and will be completed by December 31,” Bajwa told The Express Tribune.
Some of the IMF board members also expressed concern over the tax amnesty scheme announced by Prime Minister Nawaz Sharif recently, according to sources.
Finance Ministry Adviser Rana Asad Amin briefed the finance minister on the progress made so far on the planned issue of sovereign bonds, efforts to streamline and increase remittances and likely improvement in foreign exchange reserves, which would have a favourable impact on the value of the rupee.
The Ministry of Finance has opened the bids invited to shortlist consultants for floating a $500 million Euro bond. The consultant is expected to be appointed next week.
Published in The Express Tribune, December 21st, 2013.