ISLAMABAD: Finance Minister Ishaq Dar asked the Federal Board of Revenue (FBR) on Wednesday to take all necessary measures to meet the tax collection target for 2016-17.

Chairing a meeting at the FBR about the state of tax revenue collection, the minister also assured the board of his support for achieving the next year’s target.

The meeting was attended by the finance secretary, FBR chairman and senior officials of the Ministry of Finance.

Mr Dar said the measures introduced in the budget will help the general public.

He said the budgetary measures are aimed at helping Pakistan achieve higher, sustainable and inclusive economic growth.

Earlier, the FBR chairman briefed the finance minister on the tax revenue collected in 2016-17 and informed him that all efforts were being made to achieve the target for the current fiscal year.

The government has projected an ambitious revenue collection target of over Rs4 trillion for the next fiscal year against the revised target of Rs3.42tr for 2016-17, reflecting an increase of 17 per cent.

The net impact of revenue measures will be Rs88bn in the next fiscal year. Another 12pc increase in revenue is expected from inflation and growth during 2017-18.

No projection was made against administrative measures in the budget documents. However, a tax official said the next year’s revenue collection will mostly rely on enforcement and detection of concealed incomes.

One major step will be the launch of a software-based system, which will detect short or no submission of withholding taxes with the Federal Board of Revenue (FBR) field formations. The new system, to be implemented from July 1, will also depict major fall in tax of individuals. Based on major variation in tax collection the officials would be able to evolve an effective strategy to deal with tax evaders.

Official documents show the FBR expects to raise Rs15bn by enhancing rates of federal excise duty on cigarettes. Moreover, Rs1bn will be collected as withholding tax on the sale of tobacco.

The FBR expected to raise Rs10bn in withholding tax after increasing the rate of excise duty on cement. The change in the mode of sales tax collection on mobile phones will help tax authorities pocket Rs6.4bn. The FBR will get Rs2.3bn by raising sales tax on textile, leather, sports, carpet and surgical sectors and Rs2.4bn through commercial imports of fabrics.

Under the scheme to regularise the retailers’ regime, the FBR expects to collect sales tax amounting to Rs6.5bn. Raising sales tax on the steel sector will generate additional Rs10.3bn.

Published in Dawn, June 29th, 2017