ISLAMABAD: The Federal Board of Revenue (FBR) collected Rs133.36 billion in taxes from salaried individuals during the last fiscal year of 2017-18, showing 20 percent growth year-over-year.
According to official data, FBR’s tax collection, under this head, amounted to Rs111.17 billion in FY2017. An official said the FBR’s efforts also resulted in increasing revenue. Tax officials examined withholding statements provided by employers to find out salaried individuals who had taxable income, but were out of the net.
Officials said raise in salary of government employees boosted tax collection. The last government announced a 10 percent increase in adhoc relief for civil and armed forces employees in the federal budget of 2017-18. The budget increased tax exempt income to Rs1.2 million from Rs400,000 with effect from July.
Officials expect a significant increase in the filing of income tax returns for the tax year 2017-18, considering the growth of tax collection from salary income. Presently around 0.75 million salaried individuals are filing income tax returns and on the active taxpayers list.
The Directorate General of Withholding Tax has already pointed out discrepancy in tax collection from salaried class. Money disbursed to salaried individuals should be cross-matched with bank accounts, the directorate proposed in a report.
Tax departments should also conduct system audit of mega corporations / large companies in public and private sectors, it said.
“It may be re-emphasised that non-cash perquisites are usually not declared in the statements. It is imperative to study terms and conditions of service provided in the service contracts/appointment letters.”
Tax officials said the income tax law defines salary income as amount received by an employee from any employment in shape of pay, wages or other remuneration, including leave pay, overtime payment, bonus, commission and gratuity.
