Revised GST to be enforced from Oct, says FBR chief

[Lahore_Real_Estate]

Monday, July 19, 2010
By Jawwad Rizvi

LAHORE

CHAIRMAN Federal Board of Revenue (FBR) Sohail Ahmed has said that Pakistan is on the track of International Monetary Fund’s (IMF) conditions and the revised increase rate of General Sales Tax (GST) would be implemented from October 17, 2010.

“The traders are the biggest evaders; they are not traders but the evaders. If they pay their due taxes then the tax targets would be achieved easily”, he said while talking to reporters after inaugurating a five days Integrated Tax Management System (ITMS) orientation workshop for 15 Afghanistan Revenue Department officials here at Directorate of Training (DOT) of FBR.

Quoting a meeting with the retailers and traders of Khyber Pakhtoonkhawa, he said, “I told them that only fewer than 50 pay their taxes and no one had objected to it but rather kept silence”.

He was of the view that if all the traders and retailers paid their due taxes as under Self Assessment Scheme then the revenue collection targets of Rs 1,667 billon would be achieved.

To a question, he said that the FBR had proposed the government to revise the duty on sugar as it was reduced by it during the last financial year following the sugar crisis in the country but it was turned down. “The current sugar price is Rs 55 to 60 per kilogram while the FBR has been deducting duty at Rs 27 to 28 per kg sugar price and it was asked by the government to increase it to the previous rate of 16 per cent and also allow collecting it at current price level”, he said adding that the government had refused it with a view to keep the rates at lower side. He mentioned that due to this reduction on duty, the FBR had faced a sizeable shortfall in the revenue collection in last financial year.

He said a junior team of IMF was in Pakistan and discussing with the government but as the country was on track in the implementation of the conditions so there was no issue in it. He said that increasing the GST rate deadline was not given by the IMF but it was self-set by Federal Finance Minister Hafeez Sheikh.

“The biggest issue now-a-days is to decide the collection of GST on services”, Sohail said, adding that provinces have been demanding to allow them to collect it but they did not have its capacity. “If the FBR would collect it then it would be integrated and there would not be any issue while many issues could be merged as missing of some sectors or multiple time collections from one sector if the provinces would collect at this stage”, he added.

Earlier, speaking on the occasion, Chairman FBR appreciated workshop designed for the Afghan Tax officials. The DOT had arranged translators for the participants, Pashto and Dari languages. “I had attended many workshops but no such facility has been provided to the participants”, he added.

In his welcome address, Director General DOT Abdul Wadood said that e-filing system of Pakistan was one of the quickest in the world and World Bank had acknowledged it and also reported this in its various publications. He said that the workshop was sponsored by the Department of International Development (DFID), UK in collaboration with FBR.