FBR’s outreach drive to boost tax returns paying off

LAHORE: The Federal Board of Revenue (FBR), as part of its extensive drive to boost revenue generation, is reaching out to the large public and private sectors organisations and companies, urging them to facilitate their employees with filing tax returns, an official said on Monday. 

“Undeniably, taxes are the primary source of revenue for any country in the contemporary world, which is the reason each country generally endeavors to improve the general state and quality of its taxation system,” Khawaja Adnan Zaheer, member FBR, told a seminar, organised by Institute of Cost & Management Accountants of Pakistan (ICMAP). 

“Tax noncompliance, in the form of tax avoidance and tax evasion, is the most common taxation problem. However, it is widely believed that a state can overcome this problem by ensuring an efficient tax regime as well as a healthy tax culture.”

Zaheer continued that the tax literacy was an important tool to promote tax culture as it could go a long way in persuading people to pay their taxes honestly and timely. “Extensive persuasive messaging can also influence people’s perception and attitude towards paying taxes, which will untimely give rise to tax compliance behavior,” the FBR member said.

He said, for FY 2017-18, the government set a tax revenue target of Rs4 trillion, which was 19 percent higher than the collection of Rs3.362 trillion during FY 2016-17. “The present drive is yielding results as according to figures released, the FBR’s provisional collection at the national level amounted to Rs 449 billion in July-August, higher by 23 percent compared to around Rs365 billion collected in the same period last fiscal year,” Zaheer added. 

He stressed that proper payment of taxes would not only stabilise the economy of the country but also improve the living standard of the people. “The class gap will reduce significantly amid improving financial conditions of poor, while literacy rate will also get better due to a high number and quality of public education institutes,” the FBR official added. 

Zaheer explained that as a result the financial sector would also improve significantly,
resulting in less or no debt financing on part of the government. “The money which the government pays in exchange for the loans taken from donors will be diverted towards poor people,” he said. The FBR officials further said that another major output would be the reduction in indirect taxes and increase in direct taxes.

 “The reduction of indirect taxes means that daily life commodities will be less expensive to buy for the poor, whereas direct taxes will further help the government expand its financial pool,” Zaheer said.