ISLAMABAD: With only about 25 days left before end of its term, the government has finalised optimistic taxation proposals for the next federal budget which is expected to propose raising Rs461 billion in additional revenue.
A well-placed source in the Federal Board of Revenue told Dawn that the FBR had finalised budgetary proposals and shared them with the finance ministry and the International Monetary Fund.
“We have finalised our tax-wise targets for the next year,” the source said.
In absolute terms, the proposed taxation target has been edged up to Rs2,651bn for the year 2013-14 from the revised target of Rs2,190bn, reflecting an increase of 21 per cent.
The source said that new taxation measures of about Rs100bn would be proposed in the budget and the government had identified new areas for taxation.
The new taxation proposals included withdrawal of exemptions given through SROs, and special procedures.
At present, 84 per cent of tariff and duty rates are either been exempted or reduced to benefit certain lobbies.
The proposals include withdrawal of exemption on domestic sales in five sectors — textile, sports, carpet, surgical and leather goods; enhancement of withholding tax rate from 0.5 to 1 per cent on supplies to exporters; introduction of uniform rate of 3 per cent withholding tax on import of all goods, including edible oil and scrap.
The FBR has proposed further tax of 3 per cent on commercial importers to unregistered persons; disallowing input tax adjustment on unregistered sales and raising of the federal excise tariff on cigarettes.
A range of other tax proposals were under consideration, the source said.
An amount of Rs44bn is expected to be raised through administrative measures by plugging loopholes in the taxation system.