PESHAWAR, Feb 20: The NWFP government has decided not to transfer the Excise and Taxation Department (E&TD) to the districts as envisaged under the Local Government Ordinance (LGO), 2001.

“Tax collection is entirely a technical job and the provincial authorities have realised that it cannot be done without proper training of staff at the local level, where inter-departmental transfers and postings on political basis is a regular phenomenon,” officials told Dawn.

They said that a high-level committee constituted by the provincial cabinet to review the matter had backed the withdrawal of E&TD from the first schedule of LGO-2001 which dealt with the devolved departments.

The committee, which was scheduled to hold some more deliberation in the days to come over the issue, in its final recommendations would ask the provincial government to take up the matter with the National Reconstruction Bureau (NRB) for its subsequent deletion from the list of decentralised departments, they maintained.

The officials pointed out that the decision to this effect came in line with preliminary findings of the committee which it had prepared after a series of meetings and evaluating the performance appraisals of Swabi and Nowshera districts.

The NWFP government authorised two district governments to collect property tax on trial basis.

“The local bodies in two districts failed to bring any improvement in the overall collection of property tax, mainly because they do not have the required capacity to undertake such core obligations,” the officials said.

According to them, E&TD employees were given training in tax collection so staffers from the general service cadres could not perform their duties and this was why the provincial government had restricted the districts not to issue any transfer and posting orders of such officials.

The officials said that the district governments of Tank and Mardan recently transferred the E&TD employees and posted inexperienced staff in their place that created a lot of anomalies, prompting the provincial government to place a ban on such transfers.

In addition, the officials continued, the elected representatives in the local bodies were reluctant to collect taxes because of political reasons, making the decentralisation of the E&TD a futile exercise.

The four federating units were bound to devolve the E&TD as per the LGO-2001. But so far none of them have decentralised the E&TD accordingly, as it was still retained by the provincial governments.

In the NWFP, the E&TD is collecting property tax on behalf of the provincial government which disburses 85 per cent of the total collection to the districts from where it collected following deducting 15 per cent of the total collection.

Under the LGO-2001, only the district governments are entitled to collect property tax at the rate of 10 per cent collection charges and the remaining 90 per cent has to be transferred to the Tehsil and Municipal Administration concerned.