January 31, 2006	Tuesday	Muharram 1, 1427

ISLAMABAD, Jan 30: As many as 22,622 cases of refund are pending with the income tax department in the current fiscal year, involving an amount of Rs26.952 billion.

Briefing the quarterly conference of the regional commissioners of income tax (RCITs), director generals of Large Taxpayers Units (LTUs) and commissioners of income tax (ICTs), Member Direct Taxes Salman Nabi said that the total number of claims as on July 1, 2005 was 58,902, involving an amount of Rs33.326 billion. He said that during the first half (July-Dec) of the current fiscal year, 119,886 fresh claims were filed in which Rs16.38 billion were involved. By December 31, 2005, 156,066 claims were either disposed of by issuing refunds or deleted, leaving the pending balance of 22,622 cases involving an amount of Rs26.952 billion, he added.

Speaking on the occasion, CBR Chairman M. Abdullah Yousuf said that the increase in income tax-to-GDP ratio from 2.8 per cent to three per cent was satisfactory, but added: “We still have to go a long way to at least double this ratio. The income tax-to-GDP ratio of even our immediate neighbouring country was over six per cent.”

“We must have a timeframe in our mind to achieve the required level. Our ultimate objective is to enhance the tax-to-GDP ratio which at the moment was not at the desired level,” he stressed.

Mr Yousuf was of the opinion that different sectors of the economy had enormous potential and emphasized on the commissioners to reach it out to increase tax collection. He said: “Our tax base was very narrow and we have to broaden it by bringing more potential taxpayers into the tax net. The focus should be to enhance the tax-to-GDP ratio and broaden the tax base and all of our efforts must be directed towards achieving these objectives.”

The CBR chairman clarified that there would be no retrenchment under the new system. However, he stressed upon the officials to improve working skills to adjust and justify their existence in the automated environment.

While reviewing the pendency of income tax appeals, he directed the commissioners to avoid litigation without any sufficient valid legal basis. He also stressed on the disposal of appeals within stipulated time. He advised them to inform the board about all those cases which were pending for over five years.