Teams tasked to identify new taxpayers in Karachi

KARACHI: Federal Board of Revenue (FBR) has constituted teams to identify new taxpayers in the metropolis, and ensure filing of tax returns and wealth statements, sources said on Friday.

The teams have been delegated with the powers to conduct assessment, audit and recovery under Income Tax Ordinance 2001, Sales Tax Act 1990 and Federal Excise Act 2005, the sources added.

Sources said the teams were constituted at the Regional Tax Office-II, Karachi in line with the broadening of tax base (BTB) initiative. Tax authorities chose Karachi as a major potential avenue to identify new taxpayers and add to revenue as currently the country’s commercial and financial hub generates around 64 percent of revenue for FBR, housing headquarters of a number of local and foreign companies. The city is also known for buzzing manufacturing and trade activities.

FBR has set up zones in Karachi, Lahore and Islamabad to broaden the tax base and get more taxpayers in the tax net. Government directed its field departments to treat taxpayers with respect and attention, saying it would not tolerate any incident involving intimidation or harassment of taxpayers.

“All our energies are now concentrated on finding new taxpayers through an extensive taxpayer outreach program, which has helped us get a significant number of additional taxpayers till now as compared to the corresponding period last year,” Haroon Khan, special assistant to prime minister on revenue said in one statement.

FBR registered 73 percent revenue growth during the last four years. But, despite issuing around four million national tax numbers across the country only 1.3 million registered taxpayers filed their returns for the tax year 2016. The estimated potential is of around 5.2 million filers. “Karachi has the potential to bring in more than half of the estimated return filers in the next few years,” an official said, requesting anonymity.

Sources said the newly-formed teams would issue return filing notices to new taxpayers and existing taxpayers, including individuals, companies, traders, wholesalers, retailers and salaried class. They would also conduct on-site surveys.

Areas that were selected for surveys are in Saddar, Layari, Liaquatabad, SITE, Jamshed town, Baldia, Orangi, Defence, Kemari, Manora, Gulshan-e-Iqbal, Gulistan-e-Jouhar, Shah Faisal, Landhi, Bin Qasim, North Nazimabad, New Nazimabad, Gulberg, New Karachi Gadap, Malir and Faisal, Korangi, Malir and Clifton cantonments.

Tax officials can conduct stocktaking of retailers, wholesalers, importers or manufacturers to determine taxable supplies. Yet, the teams would have to obtain approval from FBR, chief commissioner or commissioner Inland Revenue prior to invoke the tax laws