'Karachi's contribution to national kitty drops to 22 percent'

[Naveed Yaseen]

KARACHI (August 05 2009): Member, Domestic Operations (South), Federal Board of Revenue (FBR) Muhammad Ramzan Bhatti has claimed that Karachi's contribution to the national exchequer has dropped from 50 percent to 22 percent. Speaking at a meeting of Karachi Chamber of Commerce and Industry (KCCI) on Tuesday evening, he said that the country is facing serious economic and electricity crisis due to which business activities have slowed down and industrial production has declined considerably.

He said that the government has decided to improve its tax collection system, which would encourage savings, investment, etc. He said that the purpose of his visit to the chamber is to consult with the business community and to discuss problems as well as take their suggestions for simplification of tax rules.

Bhatti said that there are one million income tax registered persons in Karachi, out of which 0.7 million are salaried person and 0.3 million are businessmen. Majority of the businessmen are non filer of tax returns.

Likewise, 70 percent of those who have registered themselves in sales tax during the month of May 2009 are non-filer of tax return due on June. He sought the help of the chambers and other trade bodies to suggest ways to increase tax base and to pursue non filer tax returns to file returns. Bhatti said that the department will soon investigate why people get registered under tax net and did not file tax return or file nil returns.

Agreeing with a suggestion to exempt new registered persons from audit for three year, Bhatti said that the trade bodies must suggest what should be charged from new registered persons. Explaining his point of the view he said help of trade bodies is necessary to avoid incidents in which a new registered person having to pay Rs 100,000 as tax, just pays Rs 500 and enjoys exemption.

Replying a question, he said that the government has already rectified 73 anomalies in the budget 2009-10. President KCCI, Anjum Nisar reiterated that anyone who earns more than tax exempted limit must pay tax. He highlighted that tax net can not be broadened without bringing agriculture sector under tax net.

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