Taking its toll: PAC orders probe into toll tax evasion

Published: March 4, 2014
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Out of 103 toll plazas, only eight are electronically monitored and leakages from these junctures were too glaring. PHOTO: FILE

Out of 103 toll plazas, only eight are electronically monitored and leakages from these junctures were too glaring. PHOTO: FILE

ISLAMABAD: 

The tax that every vehicle pays while running on roads is not reaching the national kitty, as massive evasion of toll taxes has been going on, mainly on motorways, prompting the Public Accounts Committee (PAC) to order an inquiry.

PAC Chairman Syed Khursheed Shah, in a meeting on Monday, directed National Highway Authority (NHA) Chairman Shahid Tarar to hold a departmental inquiry into the source of leakages and suggest measures to plug them.

The increasing traffic on national highways and motorways, which was putting extra burden on infrastructure, was not proportionately reflected in revenues, said Shah while reviewing the revenue collection from toll plazas across the country.

Out of 103 toll plazas, only eight are electronically monitored and leakages from these junctures were too glaring. “There is a need to check massive leakages, which are going on in connivance with NHA staff,” he said.

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The NHA chairman and its member finance tried to mislead PAC on account of increase in toll tax rates, reasons of leakages and award of toll fee collection contracts at prices lower than the reserve rates. They had to face a barrage of questions from PAC members, who were not satisfied with the way the NHA was being run.

In the last fiscal year 2012-13, total revenues from toll plazas remained at the previous year’s level of Rs13.4 billion despite the addition of a plaza, according to Tarar.

He said during the first half of the current fiscal year, total revenues stood at Rs6.6 billion despite addition of three plazas to the pool of 100.

However, the main problem was with three national motorways, which were under the control of Frontier Works Organization (FWO) – a military wing, which fell within administrative control of the Ministry of Defence.

In the last fiscal year ended June 30, 2013, gross toll collection from the three motorways fell 2.5% to Rs3.2 billion despite about 8% increase in traffic. The major contribution of Rs2.2 billion came from M-2 (Islamabad-Lahore) motorway. In the first half of the current fiscal year, the NHA collected Rs1.4 billion and indications were that it would not be able to achieve full-year target of Rs3.7 billion.

PAC member Mian Abdul Manan of the PML-N observed that electronic systems of the motorways had been hacked aimed at embezzling revenues.

Tarar admitted that the NHA did not have a foolproof mechanism to record the traffic passing through the toll plazas. He said the problem was that the data of Pakistan Revenue Automation Limited – the electronic service provider to the NHA – was supporting revenue collection figures of the FWO.

He insisted that load-shedding was adversely affecting the systems and on motorways often manually-stamped passes were issued to the vehicles.

“Audit of toll plazas of the motorways is not within our ambit and it is up to the sweet will of the FWO to pay whatever amount it likes,” said NHA Member Finance Shoaib Ahmad.

In reply to a question, NHA officials conceded that sometimes contracts were awarded below the reserve price. The director general of the Auditor General of Pakistan disclosed revenue losses of about Rs900 million due to award of toll collection contracts at rates lower than reserve prices.

Despite massive slippages, the NHA was again considering increasing toll tax rates to enhance revenue generation. Toll rates were revised three years ago and would be revised again this year, said Tarar.

He said revenue streams were not sufficient to maintain the network of 12,131 kilometres and the NHA wanted to plug loopholes and rationalise prices for improving revenues.

Published in The Express Tribune, March 4th, 2014.

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