KARACHI: Sindh’s tax collection rose six per cent to Rs24.972 billion during the first nine months (July-March) of this fiscal year from Rs23.594bn during the same period a year earlier.

However, the collection constituted only 67pc of the Rs37.317bn target set for the period.

Collection from motor vehicle registration (MVR) stood at Rs3.131bn against Rs3.027bn last year. The meagre rise in revenue from MVR has been attributed mainly to high rate of withholding tax (WHT) imposed by the Federal Board of Revenue (FBR) two years ago.

The highest jump (12pc) in revenue was recorded in professional tax which rose to Rs252m this year from Rs224.8m. The increase in revenue is due to computerisation of tax procedures. The Excise and Taxation department hopes to achieve 20pc increase in professional tax revenue by the end of this fiscal year. Collections from excise duty increased by 10pc year-on-year to Rs2.806bn from Rs2.537bn.

Revenue from infrastructure cess charged on imports contributed Rs17.088bn, a rise of 7pc compared to Rs16.071bn a year earlier. Fee charged on every bale of ginned cotton generated Rs202.2m against Rs190.5m.

There was a big jump in collection from entertainment duty this year which rose by 21pc to Rs35.4m during July-March versus Rs29.1m a year ago. The increase is said to be a result of improved law and order situation in Karachi.

The only decline in revenue (of 3pc) was recorded in collection from property tax which fell to Rs1,455.3m from Rs1,511.3m, mainly due to the shift to generating tax challans electronically.

Excise and Taxation Director General Shoaib Siddiqui told Dawn that the department collected Rs13.777bn more in revenue from six provincial taxes compared to the previous year. He said infrastructure cess amounting to Rs2.292bn has been paid by importers through bank guarantees. Considering this amount, the total collection would reach Rs19.38bn.

The department is taking additional measures to make up for the loss in revenue due to high WHT on motor registration. It has decided to launch a 15-day road checking campaign from May 28 to apprehend defaulters.

Published in Dawn, April 26th, 2015

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