ISLAMABAD: The Federal Board of Revenue (FBR) will roll out a Track & Trace (T&T) system for tobacco, cement, fertilisers and sugar from July 1 in a bid to enhance revenue collection in the country, a meeting of the Senate Standing Committee on Finance, Revenue and Economic Affairs was informed on Monday.
The next step will be a T&T system for beverages, Member Operations Inland Revenue Dr Muhammad Ashfaq told the Senate body meeting chaired by Senator Farooq Naek to review various measures undertaken by the FBR to plug loopholes that allowed tax evasion.
Dr Ashfaq while briefing on the T&T system said that it should be implemented as per the recommendations of the World Health Organisation (WHO) which has also suggested raising taxes on tobacco. There have been five attempts to launch the T&T system in the country, however it is finally being implemented now.
He said a consulting firm has been hired and added that the system would also help overcome issues of under-invoicing as well as expanding the tax base.
The committee recommended sending the Companies Amendment Bill 2020 to the House.
Senator Naek said the bill needs in-depth deliberations to create better responsibility of corporate social responsibility (CSR) among the companies so that the allocated funds could be utilised for local development. The committee chairman added that companies were exploiting natural resources while ignoring to allocate funds for the development of the area.
Senator Javed Abbasi stressed the need for making it mandatory to make it binding for the corporation to spare funds for social responsibility that would help in poverty elimination and reeducation promotion.
Mr Abbasi suggested that two per cent allocation from companies would bring significant changes in the areas. He said there is no clear definition of CSR under the Companies Act.
The FBR informed the committee that since the Covid-19 pandemic, the government has given Rs1,400 billion tax exemption.
Mr Naek said the FBR has given all tax exemptions to the elite, adding: “This exemption is not for the poor.” He said the number of companies listed in the country is decreasing.
According to the FBR, tax exemptions were also given in Europe and America as coronavirus spread.
Mr Naek suggested a well-known social worker should also be included in the board.
The meeting was attended by chairman and officials of the FBR as well as by the representatives of the Ministry of Finance and Securities and Exchange Commission of Pakistan.
Published in Dawn, February 16th, 2021