KARACHI: Final notices have been issued to the public and private limited companies and modarabas that owe millions of rupees in professional tax to the Sindh government.

These defaulters have been asked to clear tax dues by June 30 or face action under the Sindh Land Revenue Act.

The move is aimed at achieving the professional tax target of Rs400m for the outgoing financial year (2014-15), compared to collection of Rs303m in 2013-14.

Revenue from professional tax stood at Rs264m during the first 10 months (July-April) of this fiscal year compared to Rs248m during the same period last year.

Director General Excise and Taxation Shoaib Siddiqui told Dawn this week that it has been decided to set up a special court under the adjudication of an additional judge on the pattern of customs court to deal with the cases of tax defaulters.

Cases will be registered against the defaulters of property tax, professional tax and motor vehicle registration when all efforts by the department to recover tax arrears are exhausted.

This would be the first tax adjudication case in Sindh which is likely to start functioning from the next financial year.

The Sindh government has sought from the federal government revision of the Limitation Act, 1941, to raise the maximum limit of professional tax from Rs100,000 to Rs500,000 for the limited companies with paid-up capital of Rs200m and above.

The department hopes revenue would increase substantially when the tax limit is raised. The tax rates for all categories of businesses and professional would be revised once the Limitation Act is amended by parliament.

A comprehensive survey of businesses and companies has been planned to widen the professional tax net which has great scope of revenue generation.

The survey would start from the major interior town of Sukkur and would cover Karachi after completing enumeration of major towns of the province.

At present, businesses are required to pay tax on the basis of annual turnover declared in the income tax return. There is a minimum Rs500 and maximum Rs100,000 tax depending on the turnover of a company.

All businesses, which do not fall under the ambit of income tax, are required to pay at a fixed rate of Rs500 annually. All petrol pumps and CNG stations are liable to pay Rs2,500 as professional tax. It is deducted from the salaries of all government and private employees at the rate of Rs150 per year.

Published in Dawn, May 24th, 2015

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