PM Imran warns of dissolving FBR over poor results

[Shahzaz ud din]

PM Imran warns of dissolving FBR over poor results
By Shahbaz Rana
Published: November 11, 2018
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Prime Minister Imran Khan. PHOTO: GOVERNMENT OF PAKISTAN.

ISLAMABAD: As performance of the tax department remains dismal even in “Naya Pakistan”, Prime Minister Imran Khan has warned that he may abolish the Federal Board of Revenue (FBR) and could create a new organisation.

The premier gave the warning during a meeting held on Thursday, sources told The Express Tribune. FBR’s top management had been called for a briefing on the board’s performance in relation to revenue collection and catching tax dodgers.

Sources said after seeing poor results, the prime minister inquired whether the FBR could be reformed or a new institution should be established.
FBR spokesman Dr Mohammad Iqbal did not comment on details of the meeting, but he said the PM emphasised the need for introducing reforms and also asked for improving the performance and integrity.

The PM stated that reforming the FBR was critical for meeting the government’s goal of providing social justice and relief to the masses, said Iqbal.

The premier’s comments indicate his displeasure with taxmen as he has declared that the government will double tax revenues from the Rs3.842 trillion collected in the previous fiscal year.

To press on with the plan, the prime minister had picked Jehanzeb Khan as the FBR chairman. Khan is an officer of the Pakistan Administrative Service. The FBR comprises over 20,000-strong workforce of the Inland Revenue Service and Customs Service.

Sources said the premier was also not interested in the presentation prepared by the FBR to show an apparently rosy picture of the tax affairs.

Finance Minister Asad Umar has already expressed his dissatisfaction with the FBR’s performance.
In spite of the difficulties, Imran reposed his confidence in the FBR chief during the meeting. He also defended Jehanzeb’s appointment during an interaction with anchorpersons about two months ago.

The FBR could collect only Rs1.1 trillion in taxes in first four months of the current fiscal year and fell short of the revised target by Rs68 billion. The growth in revenue collection was less than 7%.

For the current fiscal year, the government has already revised downwards the annual target to Rs4.398 trillion and it seems that if things are not reversed, the FBR may face a shortfall of Rs150 billion to Rs175 billion at the end of the year.

The finance minister on Thursday said the Pakistan Tehreek-e-Insaf government’s success and failure hinged on the FBR’s performance.

The poor tax collection and its implications for the budget deficit turned out to be the biggest concern for the International Monetary Fund (IMF) during ongoing technical-level talks. Due to the shortfall in tax revenues, the budget deficit is expected to widen to around 1.4% of gross domestic product (GDP) in the first quarter.

Sources said there was talk in the Q Block and the FBR headquarters whether to continue with the existing FBR chairman or a new head should be brought from among FBR services.

However, blaming the FBR chief alone for the poor performance will not be justifiable as the FBR has always resisted reforms. For the past over one and a half year, the FBR members have not allowed implementation of administrative and policy reforms proposed by the Tax Reforms Commission.

The FBR is resisting even the simplest things like installation of a trace and tracking system in industries that are prone to high tax evasion like cigarette manufacturers. Despite the finance minister’s instructions, the FBR has not developed a simple one-page income tax return form for the salaried class.

The FBR has developed a new return form for the salaried class but it is still complicated for many.

The FBR has also been resisting the appointment of technically qualified people on the board of Pakistan Revenue Automation Private Limited – a subsidiary of the FBR that is responsible for using information technology for tax collection.

There are nearly 3.8 million National Tax Number (NTN) holders in Pakistan and only 1.4 million of them file income tax returns. The FBR has not been able to catch even these 2.8 million people who have the NTN but are not filing returns.

Efforts have not been made to improve audit functions and an almost negligible workforce has been assigned the audit task.

The FBR has issued an advice to the State Bank of Pakistan for releasing sales tax refunds amounting to Rs8.7 billion to facilitate exports.

The payment will benefit 739 claimants from five zero-rated export-oriented sectors – textile, carpet, leather, sports goods and surgical instruments. The refund will be made against 4,117 refund payment orders issued up to November 8, 2018.

The tax refunds will be transmitted electronically to respective bank accounts of the claimants by the State Bank by the close of banking hours on Monday, November 12, 2018.

The payments will be made to all those claimants who have provided their bank account details in the IBAN format.

Published in The Express Tribune, November 11th, 2018.

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[CriticalThought]

During the late 1990s my parents owned a shop in a posh shopping centre in Clifton. One day I saw the tax man arrive and discuss the matter of tax payment. He came up with a figure that my parents had to pay. After he left I confronted my mum on this. I insisted that we should determine the correct amount of tax and pay it to the government. My mother told me that if we asked to do things right, he will come up with a ridiculously large amount. So I said, OK, let us pay him what he wants but then ask him to perform the correct tax assessment. By thus time another shopkeeper had joined and he said "Forget about correct tax assessment. These people have 'khanchas' everywhere. If the government sees correct tax returns for one shop, they will want to know about the rest of the shopping centre".

This is the extent of this problem. These tax collectors have a system reaching every single shop and office. Their livelihood is dependent on pilfering tax money.

I think abolishing FBR is the way forward. Fire the whole lot of them top to bottom. There are similar mafias appointed for collecting parking fees. Again, they are present in posh areas like Clifton. Where does this parking fee go?

 

[Hakikat ve Hikmet]

An empty house is better than a bad tenant..

Courage takes a man to victory, indecision to danger, fear to death - Yavuz* Sultan Selim

*resolute/ferocious

 

[AZADPAKISTAN2009]

Pakistani Economy has to be converted from Income tax based economy to Permit based society

You get services Pay as you Go

FBR is not fixable as Pakistanis have no business paying taxes they feel it is their god given right to not pay taxes

 

[Trango Towers]

Import well educated young Pakistani professionals from abroad and give them a big stick. Let them loose on these thieves. You will see immediate results.
I would start with everyone who has a land-cruiser and everyone who has big houses.....prove your income....no issue. Cant prove it then its the governments

 

[AZADPAKISTAN2009]

Education / Stick has no connection this is about Corruption at grass root level in Pakistani Citizens it is part of cultural thought

Tax = ???? = Ja Yar ..... when my Neighbor will pay
Tax = ???? = No way I am not that rich I have to save up for my BMW
Tax = ???? = Absolutely shocked you asked me that question , I am a Pakistani you know
Tax = ???? = Think about all the women and children who will die , if people paid taxes

The "ONLY" and I repeat the only way to collect money from Pakistanis is by
Permits

a) Private Shops permits 1000 rupee per month need to be deposited monthly in order
to Keep the door to your shop open (Enforced by Local Police)

b) Right to Drive your Vehicle on Roads permit (100 rupee permit per car owned in Pakistan)
Car/Motor Bike / Bus/ Truck all covered under this move

c) Cell Phone recharge 30% goes towards Taxes for Goverment every time you recharge

d) Qurbani Tax , get a voucher / permit before you can perform Qurbani , voucher attest you are rich enough to do Qurbani

e) Parking Permit every must buy a Parking Permit in order to park in areas of work , downtown


75% of People are outside of Tax net

a) Resturant owners
b) Street vendors
c) Private bus businesses
d) Barbers
e) Taxi drivers
f) Bus drivers
g) Rickshaw drivers
h) Hotels
i) Shadi halls
j) Small shops in Pakistan , which are privately owned small shops
k) Private school teachers doing private offerings
l) Book shop vendors
m) Taxtile shops
n) Beauti parlors


Just ask all these entities to pay 1,000 Monthly each month in order to remain open for business in Pakistan


For Car Permit enforcement put .....checking booths on roads you pay Toll to drive on roads or you buy a monthly permit

 

[litman]

i am not willing to pay any tax to the govt till the time all the looted money is taken back from all the looters.

 

[AZADPAKISTAN2009]

Very easy to collect Toll Money on road no , issue with FBR guy running around crazy ...put a collection center on road and every time a car goes buy you collect money

• Highways
• Inner city roads

Or you Buy a Monthly Pass

Every time someone , renews this month to month , Government collects 1,000 Rupee tax
At least collect 12,000 rupee per shop then ZERO RUPEE

All those Pakistanis that have an "Excuse" to justify why they would not pay Tax should be
forced to pay Money alternative means


a) Shop permit (Monthly 1,000 Rupee)
b) Cell Phone recharge (30% charged on every Monthly charged)
c) Pass /Permit for every car in Pakistan, so it can be driven on Roads owned by Pakistan
d) Qurbani tax per animal
e) 30% Tax on Utilities , Eatable goods , Water , Drinks
f) Parking Pass , that parking space is owned by state of Pakistan it is not free you need to pay

 

[S.Y.A]

Education / Stick has no connected this is about Corruption at grass root level in Pakistani Citizens it is part of cultural thought

Tax = ???? = Ja Yar ..... when my Neighbor will pay
Tax = ???? = No way I am not that rich I have to save up for my BMW
Tax = ???? = Absolutely shocked you asked me that question , I am a Pakistani you know
Tax = ???? = Think about all the women and children who will die , if people paid taxes

The "ONLY" and I repeat the only way to collect money from Pakistanis is by
Permits

a) Private Shops permits 1000 rupee per month need to be deposited monthly in order
to Keep the door to your shop open (Enforced by Local Police)

b) Right to Drive your Vehicle on Roads permit (100 rupee permit per car owned in Pakistan)
Car/Motor Bike / Bus/ Truck all covered under this move

c) Cell Phone recharge 30% goes towards Taxes for Goverment every time you recharge

d) Qurbani Tax , get a voucher / permit before you can perform Qurbani , voucher attest you are rich enough to do Qurbani

e) Parking Permit every must buy a Parking Permit in order to park in areas of work , downtown


75% of People are outside of Tax net

a) Resturant owners
b) Street vendors
c) Private bus businesses
d) Barbers
e) Taxi drivers
f) Bus drivers
g) Rickshaw drivers
h) Hotels
i) Shadi halls
j) Small shops in Pakistan , which are privately owned small shops
k) Private school teachers doing private offerings
l) Book shop vendors
m) Taxtile shops
n) Beauti parlors


Just ask all these entities to pay 1,000 Monthly each month in order to remain open for business in Pakistan


For Car Permit enforcement put .....checking booths on roads you pay Toll to drive on roads or you buy a monthly permit

so instead of the FBR doing their job properly, your solution is to make things even more expensive? so that the rich remain rich and the poor can never even dream of raising their standard of living? all that you have said is good for developed countries where per capita income is also high. in Pakistan it will just create even larger gaps between the haves and have nots.

utilities. eatable goods, television tax, parking charges are all already being implemented. Also, why should one pay tax? is the car secure in that parking space? no it isnt. are the roads being taken care of? no they arent. is quality healthcare and education easily available? no security and justice as well. so where is the tax money going to?

 

[AZADPAKISTAN2009]

FIRE FBR .....release them .....

What is FBR generating ?? 0.01% population pays taxes what they generate 1-4 million
Let FBR fully focus on Big Entities like Banks / Corporations / Factoriess

But let the PERMITS collect from middle /poor class

Simple Permit System:
Cell phone Tax : 1.2 Billion Dollar can be raised
Small Shop permit: 3.8 Billion Dollar can be raised
Road Permit : 438 Million Dollars (100 rupee per month per vehicle , driving rights on Pakistani road)
Qurbani Tax : 200 Million Dollars
Tanker Mafia fight : Save 800 Million Dollars
TV Per home Tax : Another avenue to collect charges
Parking Pass per vehicle : 438 Million Dollars (100 rupee per month per vehicle park anywhere on road)

 

[Amaa'n]

a year & half ago i had brought a microwave oven in my luggage from gcc country. prior to my travel i had checked on FBR website, that a tax of 28$ was to be paid on this item. i had the money & was ready to pay.....when i landed, Customs officer in plain clothes asked me to get my Luggage checked to which i did tell him i have a microwave oven, he said you will have to pay tax & i noded in affirmative manner......instead of us going towards NBP counter to pay tax, he took he to a corner and asked to pay "Dallar" i requested to see a receipt that tax has been paid, he said "sab mil jaye ga, dallar tou dou"....first i thought of complaining to his higher ups but then i realized that we were standing exactly outside Director Customs office and it was a glass door....a man sat on the chair......i figured it out...being a frequent traveler decided to fight my way out of it, after all lot of begging by the Customs guy, i ended up paying with 1000rs that all went in his pocket.......

this is FBR .....even today same is being done.....so it is best to abolish this department all together......

 

[Yaseen1]

Qurbani tax is unIslamic and there is no tax in west on chrismas shopping but instead discount is given to public ending fbr without proper homework and replacement will make tax revenue more declining our tax system has resemblence with that of u.k and rest of world that is why Acca syllabus of taxation is similar to Pakistan C.A course although Acca is u.k based qualification and chartered Accountants study taxation in detail so importing foreign qualified will not solve problem easily unless govt not have clear vision and not give the tax professional already available free hand to form policy and the main problem lies with lower level staff who collect tax.Tax collection should be computer based to avoid corruption

 

[AZADPAKISTAN2009]

(Bribe) That comes under the corruption / fighting corruption cases for which the ideal punishment is 1-2 years prison for petty cases and 10 years to life term for large cases

Qurbani tax is unIslamic and there is no tax in west on chrismas shopping but instead discount is given to public ending fbr without proper homework and replacement will make tax revenue more declining our tax system has resemblence with that of u.k and rest of world that is why Acca syllabus of taxation is similar to Pakistan C.A course although Acca is u.k based qualification and chartered Accountants study taxation in detail so importing foreign qualified will not solve problem easily unless govt not have clear vision and not give the tax professional already available free hand to form policy

What is unislamic about it ?
Religion states , only the rich should do Qurbani

If you are Rich , then get confirmation from state you are rich Get Permit and then do what you want with that permit buy animal and do your qurbani


If someone can't Pay tax because someone claim they are poor , but then they go buy a 3 Lakh rupee (3,000 dollar ) animal for own BBQ party , so two things don't add up it's time PAKISTAN enforced these laws in place


So we get one thing stright

a) Either you are poor
b) Or you are rich


People can't claim they are poor while owning property worth 10-15 million dollars
(Agricultural farm land , semi castle like homes , 10 cars)

And best way to do it by Permits

Qurbani tax is unIslamic and there is no tax in west on chrismas shopping but instead discount is given to public ending fbr without proper homework and replacement will make tax revenue more declining our tax system has resemblence with that of u.k and rest of world that is why Acca syllabus of taxation is similar to Pakistan C.A course although Acca is u.k based qualification and chartered Accountants study taxation in detail so importing foreign qualified will not solve problem easily unless govt not have clear vision and not give the tax professional already available free hand to form policy and the main problem lies with lower level staff who collect tax.Tax collection should be computer based to avoid corruption

There is 15% Sales tax on all goods sold during Christmas season and on top of that shipping charges are charged on top which sometimes are more then what is actually needed to ship an item

Christian head of family (Father/Mother ) buy gifts for all family and every one of those gifts involve 15% Tax paid to Government. And that too after both Father/Mother's salaries have paid 27-40% Taxes on their income

• The issue is not Policy
• They issue is not People in office who are not hoping to collect money from Pakistani
• The issue is not having world class accountants we have some best accountants

THE ISSUE IS PAKISTANI PEOPLE MIND and you can't change that because people have literally become stubborn, it's the mindset we will not stand in line , but once we are in Jeddah Saudi arabia we will stand in a line otherwise the Saudi officer will hit us on buttocks



There is no need for debate .......
Very simple concept .....you want to use something which state owns , a service you pay

a) Road is owned by state , citizen you want to use it you better have pass or permit
b) You want to park your old cars on streets owned by state of Pakistan you better have a parking pass or Permit
c ) You want to keep your shop open ? Better have a permit

 

[CriticalThought]

(Bribe) That comes under the corruption / fighting corruption cases for which the ideal punishment is 1-2 years prison for petty cases and 10 years to life term for large cases




What is unislamic about it ?
Religion states , only the rich should do Qurbani

If you are Rich , then get confirmation from state you are rich Get Permit and then do what you want with that permit buy animal and do your qurbani


If someone can't Pay tax because someone claim they are poor , but then they go buy a 3 Lakh rupee (3,000 dollar ) animal for own BBQ party , so two things don't add up it's time PAKISTAN enforced these laws in place


So we get one thing stright

a) Either you are poor
b) Or you are rich


People can't claim they are poor while owning property worth 10-15 million dollars
(Agricultural farm land , semi castle like homes , 10 cars)

And best way to do it by Permits



There is 15% Sales tax on all goods sold during Christmas season and on top of that shipping charges are charged on top which sometimes are more then what is actually needed to ship an item

Christian head of family (Father/Mother ) but gifts for all family and every one of those gifts involve 15% Tax paid to Government

• The issue is not Policy
• They issue is not People in office who are not hoping to collect money from Pakistani
• The issue is not having world class accountants we have some best accountants

THE ISSUE IS PAKISTANI PEOPLE MIND and you can't change that because people have literally become stubborn, it's the mindset we will not stand in line , but once we are in Jeddah Saudi arabia we will stand in a line otherwise the Saudi officer will hit us on buttocks



There is no need for debate .......
Very simple concept .....you want to use something which state owns , a service you pay

a) Road is owned by state , citizen you want to use it you better have pass or permit
b) You want to park your old cars on streets owned by state of Pakistan you better have a parking pass or Permit
c ) You want to keep your shop open ? Better have a permit

Religious matters are very different. If Allah Subhaanahu Wa Ta'aala has not specified a tax, you cannot levy the tax. There are a million other avenues. Forget taxing Islamic practices.

 

[AZADPAKISTAN2009]

Allah Subhanahi wa ta alla has also stated don't go to IMF
Why are we paying Interest on these massive loans ?

Fine tomorrow every one when you get paid salary deposit it 100% to Pakistan Fund , so Pakistan does not have to go to IMF

I am glad we sorted out this ..... we won't go IMF and we will get rid of interest loans ....every one will pay their share of Income Tax and honestly declare value of their property

Can't pick cases to suit own personal needs

Zakat is a mandatory item !!! Zakat = Tax

It does not mean giving a 5 rupee note to some poor kid on street and you walk away ...ok I am done for the year


The Qurbani Tax is on the "SALE OF ANIMAL" the state is within their rights to collect taxes on that animal sale. You wish to keep that animal for your own PET or Qurbani is up to you


a) Qurbani Tax should be 100% taxed and collected every animal sold in Pakistan
b) Anyone having 3 wives should be sign the man is Rich and should be Tax according to the number of wives he has



Saudia imposed a 3,000 riyal tax on people coming to do Umra ? hmm sounds like a Tax and every one paid ..... state laws


The Qurbani Tax Permit , is a confirmation by State of PAKISTAN , this person X, Y, Z is indeed rich !!! and thus he is 100% qualified to perform the duties of Qurbani.

If someone is poor (Can't pay State taxes) .... they don't have to do Qurbani
Because of their poverty level and that is fine 100% allowed , you can skip doing Qurbani