ISLAMABAD, April 28: The Central Board of Revenue (CBR) will soon introduce amendments to the sales tax return form in the budget 2007-08 for soliciting information in respect of production of the manufacturing sector to check concealment of tax payment.

An official in the CBR said a formal decision was taken recently in the quarterly conference of the collectors of sales tax.

The need for seeking production data was felt following the observation that manufacturing sector understated their production capacity that resulted into evasion of general sale tax.

Chairman, Central Board of Revenue (CBR), M Abdullah Yousuf, has also sought proposals from ST collectors for introduction of this amendment besides others to be incorporated in the budget.

An official announcement said that the chairman has also directed the collectors to conduct a comprehensive study of all manufacturing and industrials units functioning under their areas of jurisdiction, and come up with a realistic data of their tax potential by ascertaining their actual production figures and sale of their products.

“We must ensure that all due taxes are collected,”, he maintained.

Mr Yusuf was of the view that there were many distortions in the retail trade, which were required to be addressed in the forthcoming budget.

He asked the collectors to come out with implementable recommendations to enable the CBR to evolve a system which could help tap full revenue potential in this sector.

Expressing displeasure over less recovery of outstanding arrears of sales tax and federal excise, the chairman directed the officials that all recoverable amount must be realised without any further delay.

Talking about short-filers and non-filers, the chairman asked the tax officials to take action against those who were actively trading, but not filing their returns.

“Short-filing should not be allowed,” he advised the sales tax officials.

He called upon the sales tax collectors to explore new potential areas for generating more revenue, which was not only essential for meeting the developmental needs of the country, but also for broadening the tax base and enhancing tax-to-GDP ratio. He observed that there were a number of other sectors which were not paying taxes in accordance with their potential or in comparison with their contribution to the GDP.

In this context, he particularly referred to wholesalers and transporters whose percentage of contribution to the GDP was comparatively much higher than their contribution to revenue.

The chairman was of the opinion that the officials need to have clarity of their requirement so that software were developed in accordance with their needs.