KARACHI: Excise dept to take up MVT proposal with federal govt
KARACHI, April 5: The Sindh Excise and Taxation Department has taken up afresh with federal authorities the proposal of collecting Motor Vehicle Tax through petrol pumps. The proposal was submitted first four years back by the then provincial finance minister, Dr Abdul Hafeez Shaikh, and pursued by successive ministers, however, could not get clearance by the federal government. Sindh Home Minister Rauf Siddiqui, when he held portfolio of excise minister in chief minister Ali Muhammad Mahar’s government, had also held meetings with representatives of other provinces to evolve a consensus on the proposal.
The adviser to chief minister for excise and taxation, M.A. Jalil, told newsmen at a press conference at his office on Tuesday said that the proposal would benefit hundreds of thousands of vehicle owners.
“We are seeking clearance of the federal government as the collection of MVT through petrol pumps would bring an end to the corruption in excise department besides increase revenue on this account,” he said.
He said that a certain amount would be charged per litre fuel at the petrol pumps as the MVT and the tax so collected would go to the provincial exchequer. “If the proposal is approved, the vehicle owners would not have to visit E&T offices and bank branches for the payment of MVT,” he told.
Mr Jalil said that a large number of vehicles from other provinces use to operate in Sindh without any payment of MVT. Since the province had no mechanism and any facility to locate such vehicles and charge the MVT, the proposed system would be of great benefit to recover such tax from these vehicles, he added.
To a question, he denied that Punjab had opposed this proposal in the past and added that in fact federal government did not give clearance besides the oil companies had shown certain reservations.
The adviser said that his department had also proposed to the government to introduce one-window system of tax collection.
“At present two taxes - Infrastructure Cess and Stamp Duty – are levied and collected at Karachi Port, Qasim Port and Karachi Airport,” he said adding that the first one is collected by the excise department and the other by the Board of Revenue. “This practice causes leakage of revenue amounting to Rs40 million per annum. In view of this, it has been proposed that the collection of Infrastructure Cess and Stamp Duty should be brought under one window that would increase the revenue from Rs98 million to Rs136 million per annum,” he added.
Mr Jalil pointed out that it was a long standing demand of trade and industry to facilitate them in tax payments. They very rightly complained that over a dozen agencies knock their door for collection of taxes of various natures and there had been suggestions from them for introducing one window system of tax collection, he added.
The adviser said that federal and provincial governments supported this view, but no appreciable progress had been made in this regard with the exception of linkage of Infrastructure Cess with PRAL/customs. Through the linkage computerized database of customs was used for assessment and issuance of computerized challans of Infrastructure Cess. This linkage brought the much needed efficiency and significant improvement in tax collection by controlling the leakages, he said, and added that similar improvement to facilitate payments of motor vehicles tax has been taken place by broadening its scheduled bank counters network from seven to 11 branches in Karachi.
Resultantly, he said, the facilitation had contributed significant increase in tax revenue collection and reduced the tax payers compliance costs. The efforts continued to further enhance and computerize network of bank branches subject to availability of online computer facilities.
He said the proposal would also save the cost of tax collection by doing away the staff at the collection points. — PPI/APP
