ISLAMABAD: The government included media, sportsmen and immovable tycoons in its hunting list of top tax evaders in the face of growing pressure on the Federal Revenue Board (FBR) to deliver quick results to address one of Pakistan’s biggest economic issues – the yawning budget deficit.
The Inland Revenue Service Chief Commissioners (CCIR) Conference, a gathering of FBR heads of all field formations, deliberated on Thursday on high-profile tax evaders cases. Three weeks after Prime Minister Imran Khan ordered tax officers to go after big tax dodgers, the meeting had been convened.
According to FBR officials, it was decided to select top 100 cases from each Regional Tax Office (RTO) and Large Taxpayers Unit (LTU) to expand the final list to 2,400. According to the FBR, these 2,400 people are politicians, celebrities, sportsmen, media and immovable tycoons.
The conference of chief commissioners was held on a day when the prime minister again warned that due to his extremely poor performance he could dissolve the FBR. Addressing a gathering of chambers, PM Khan said that if the FBR did not improve its affairs, he could set up a new organization.
After the PTI came to power last year, the FBR was constantly under pressure. The Premier grilled the top FBR management behind closed doors for his poor performance.
The administration of the FBR consists of 19 RTOs and four LTUs, led by chief commissioners. FBR’s Inland Revenue Service Member Operations Seema Shakil asked all chief commissioners to bring their own list of top 100 tax evaders.
Sportsmen, media personalities, celebrities including singers, politicians and businessmen including real estate tycoons should be the preferred areas for selecting the cases, according to the instructions given to the chief commissioners.
However, “because of lack of time, it was not possible to select the top 2,400 tax dodgers,” a chief commissioner told The Express Tribune.
But a member of the FBR said that nearly all chief commissioners had finalized their lists and on Thursday 12 of those lists were discussed. These cases were selected on the basis of the 2017 Tax Directory on the criterion that these people’s declared income did not match their lifestyles, officials of the FBR said.
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The FBR also appointed Mir Badshah Khan Wazir as Chief Executive Officer of the Tax Base Broadening Directorate on Thursday. The main task of the directorate is to go after unregistered individuals and bring them to the tax net.
The FBR also directed its field formations to also select a significant number of parliamentarians to send tax notices based on income declared in their tax returns for tax year 2017, officials said. The cases of the parliamentarians were also discussed during the conference of the commissioners.
In terms of tax contributions, the top 10 parliamentarians paid Rs322 million in taxes, which was equal to 60% of the total taxes paid by all parliamentarians in the 2017 fiscal year. Parliamentarians ‘ fifth tax directory showed that legislators, including federal cabinet members, paid Rs535 million in taxes during the 2017 tax year, up Rs139 million or 35 %.
Last month, PM Khan ordered the FBR to bend its muscles against large tax evaders and in the next four months make them cough up almost Rs200 billion. The tax shortfall of the FBR is widening with each passing month. In the first eight months of the current fiscal year, it sustained a Rs237-billion shortfall as the collection stood at only Rs2.32 trillion.
The chief commissioners also reviewed the poor tax performance in February as only Rs268 billion could be collected by the FBR against the Rs314 billion target.
The government has set a budget deficit target of 5.1% of gross domestic product (GDP) for the current fiscal year. But the deficit widened to 2.7 percent of GDP or Rs1.03 trillion in the first half due to a sharp deficit in tax revenues and higher spending on debt servicing and defense needs.
The conference also reviewed the overall progress of a campaign to catch people with high net worth. The FBR has issued over 6,500 tax notices so far, recovering nearly Rs1.4 billion from these people in the current fiscal year.