ISLAMABAD: Member Inland Revenue Federal Board of Revenue (FBR) Rhmatullah Khan Wazir has said that Pakistan had been ranked among top of the countries which collect revenues through direct taxation.
At present, the FBR collects an average amount of Rs 18, 000 from every individual in the country and this amount is far more than is being collected from per capita in other countries,” he said, while defending FBR’s performance in the meeting of the Senate Standing Committee on Finance and Revenue here.
Director General Broadening of Tax Base Wing Shaista Abbas and Chief Operations Yousaf Haider Sheikh were also member of the FBR team to respond to the figures of the taxpayers presented in a briefing to the committee by a non-governmental organization Research and Advocacy for the Advancement of Allied Reforms (RAFTAAR).
Headed by Dr. Salman Shah, former caretaker finance minister and advisor to prime minister Shaukat Aziz, RAFTAAR focuses on two of the most pressing areas of reform that are impeding Pakistan’s development trajectory: tax and energy.
Rehmatullah Wazir, while rejecting the figures presented by the said NGO observed that NGO had services of only six or seven economists but FBR enjoyed the full time support of over 25 economic experts at the platform of Tax Reform Commission (TRC).
“Therefore, recommendations finalized by the TRC regarding broadening of tax base (BTB) are more worthy of being taken under consideration as the analysis prepared by a few economists as the later may be based on research on media reports which may not be updated” he added.
He further said that FBR was performing very well and it collects 90% of total revenue from corporate sector because there were minor chances of paying the rebate and refund to the taxpayers from this sectors as compared to individual taxpayers.
Wazir observed that despite numerous hurdles and impediments, the FBR had collected a huge and unprecedented amount of Rs 2105 billion as revenue collection in first three quarters of the current fiscal year and it would easily meet the revenue collection target fixed for the whole year.
Speaking on the occasion, Chief Operations Yousaf Haider Sheikh said that it was quite unjust to compare FBR’s performance with tax authorities of the other countries because other countries spent huge amounts on the tax authorities than government was spending on FBR.
“FBR carrying out entire activities with the help of a meagre number of staff both officers and field officers of 21 000” he added saying that India and other countries were spending 2.5 to 3.5% to total budget on the tax authorities whereas here in our country government was making an expenditure of 0.7% on FBR.
This comparison of expenditures and performance given by Yousaf Haider Sheikh silenced both the Senators and the representatives of RAFTAAR.
Earlier, in his presentation RAFTAAR Chief Dr. Salman Shah and renowned economist Saqib Sherani tried to down play the performance of FBR regarding broadening of tax base, but Rehmatullah Wazir turned turtles by saying that FBR did not want to bring all the individuals in the tax-net because then FBR would have to pay refunds and rebates in bigger amount than the total revenue collection.
