ISLAMABAD, March 13: The Central Board of Revenue (CBR) has decided to establish a distinct client selection criteria for expanding the client base of the Large Taxpayers Unit (LTU), Karachi, from the next financial year.

Official sources told Dawn the proposed expansion of the client base of the LTU, Karachi, would be between 500-600 taxpayers from the current 494 taxpayers by end October 2003.

This refinements of the LTU would be carried out over the medium term in line with new client selection criteria to be formulated by the tax reform teams.

The officials said the tax authorities would undertake a work and job redesign process for support positions in the LTU with the objective of increasing the individual tasks carried out by each member and as a result their value to the LTU’s operations.

According to the official, the International Monetary Fund (IMF) has recommended to the CBR to develop a plan to improve the skills and competence of audit officials aimed at improving further the audit capability of the LTUs.

Under this programme, the number of audit officials would be increased available for the LTU taxpayers in line with a clearly defined audit policy covering such matters such as audit coverage, depth of audits use of team audit approaches.

The officials said the action plan at the LTU includes: notification of quarterly audit schedules, auditors to taxpayers ratio to be increased to 1:25 from current 1:200; full access to income tax data; a two-member team for each unit; introduction of comments cards; introduction of post audit meeting with taxpayers and communication of audit observations to registered persons.

The other major steps for refining the work of LTU would include to devise a comprehensive and integrated management information system for key aspects of the LTU’s operations.

The LTU would also test system of electronic tax return filing and payment before it was implemented in the rest of the country.

The officials said that experiment on a phased basis with the integration of some work process would be carried out over the next 6-12 months.

The reform team would review taxpayers identification criteria, with a view to eliminating inconsistencies and to expanding operations in Karachi and Lahore by March 31.

With all these steps, the officials said that planning for the establishment of LTU at Lahore would be started from April 2003, while the CBR would implement the refinements to operations of the Karachi LTU along with lines recommended by in the IMF mission report.

The LTU at Lahore would be established by April 1, 2004, added the officials.