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Business

Web Desk
April 21, 2020

FBR says income tax collections failed to meet March target due to pandemic

Business

Web Desk
Tue, Apr 21, 2020
The News/via Geo.tv/Files

ISLAMABAD: The Federal Board of Revenue (FBR) said Tuesday Pakistan's income tax collections failed to meet the March 2020 target due to the ongoing coronavirus pandemic.

The income tax collections were also unlikely to meet the target in April, FBR spokesperson Hamid Ateeq Sarwar said during a press briefing here in the federal capital. A further reduction in the prices of petroleum products would increase the revenue shortages, he added.

Sarwar — a member of the FBR's Board and working in the body's Inland Revenue Policy and Facilitation & Taxpayers Education departments — said the tax collections dipped due to the coronavirus pandemic. As opposed to March's target of Rs500 billion, the income tax collections amounted to Rs300 billion, while the figure was expected to clock in at Rs200 billion for ongoing April.

He added that the government was slashing prices for the benefit of common people and that permission to import medical equipment was given according to instructions from the Cabinet.

Relief, he added, was given to the construction sector as per Prime Minister Imran Khan's directives. "If someone, including builders and [real estate] developers, wished to construct houses, they should inform by December 31 and then they would not be asked about their sources of income," he said.

However, in doing so, they should ensure they ready their projects by September 30, 2022.

73% more refunds released

He noted that these measures were introduced to provide employment to labour and bolster economic activity in Pakistan. Various taxes have been done away with or waived off for the construction sector, he added.

Also present at the press briefing was Seema Shakil — a member of the FBR's Board and working in the body's Inland Revenue Operations department — who said 73% more refunds have been released since the start of COVID-19 to date, fast-tracking Rs52 billion.

Rs70 billion was allocated according to PM Imran's package, Shakil noted. Of that amount, Rs30 billion was given to the commerce ministry. Sums worth Rs38 billion and Rs15 billion were released as sales tax and customs refunds, she added.

"We're in touch with people via email owing to health risks," she explained, adding that people should contact the FBR by responding to its email to obtain refunds.

Shakil also underlined that updating the IBN would help facilitate refunds, which were being sent directly to people's bank accounts. Rs2.1 billion worth of refunds — for transaction between Re1 and Rs5 million — would be transferred tomorrow (Wednesday), she added.

'Removed human intervention'

Refunds for more than 3,000 people who updated the IBN were for transactions between Re1 and Rs5 million, she said, adding that another 6,000 were unaware due to failure to update their IBN.

The FBR board member said the organisation would now focus on the refunds for transactions upwards of Rs5 million. "We have removed human intervention from our entire process," she said.

Shakil also mentioned that the FBR was encountering problems with regard to the withholding tax from banks. "There were challenges in refunds on electricity and gas bills due to CNICs," she said.

Sarwar, the other board member, said forms had been created in Urdu for returns-filers and that easy tax app was also available on the FBR's website.

"The taxes on imports have been reduced on vegetable oil and pulses so as to reduce the prices of [food] items," he added.