KARACHI, Jan 12: The Sales Tax Collectorates, East and West, Karachi, have collected Rs14.597 billion during July- Dec 2001, compared to Rs13.703 billion during the same period last year, registering 6.45 per cent increase.
According to official figures made available here on Saturday, East raised Rs11.437 billion in revenue compared to Rs10.445 billion collected during the first six months last year, an increase of 9.50 per cent.
However, the Collectorate of West recorded negative growth in ST collection netting Rs3.149 billion compared to Rs3.258 billion during the same period last fiscal year, falling short by 3.32 per cent.
Official sources said the setback received by the economy in the wake of Sept 11 events particularly during second quarter (Oct to Dec) of current fiscal year because of Afghan war resulted in lesser revenue collection to the national exchequer.
As a result of this the Sales Tax Collectorate (West) during the entire second quarter (Oct-Dec 2001) registered a negative collection of revenue. In Oct 2001, ST collection was less by 14.02 per cent at Rs491.500 million. In Nov and Dec 2001 the collection was down by 7.64 per cent and 9.28 per cent at Rs485.900 million and Rs486.030 million respectively.
Nevertheless, after clubbing of collections of both the collectorates not only the collective and final figure of revenue during last six months but each month’s collection also moves into positive columns.
But sources close to sales tax collectorates (East and West) reckoned that sharp fall in new taxpayers’ registration under ST during last four months had been one of the major factors for fall in revenue collection.
The official figures further disclosed that during last six months (July to Dec 2001) both the collectorates disbursed Rs10.309 billion towards refund, which stood 78.50 per cent higher than a year ago.
The Collectorate of East paid Rs6.473 billion or 83.66 per cent higher in refunds during July-Dec, 2001 as against Rs3.524 billion paid during the same period last fiscal.
Similarly, the Collectorate of West disbursed Rs3.836 billion or 70.41 per cent higher towards refund claims over previous year’s refund of Rs2.251 billion.
Sources said there is urgent need to improve the ST refund system which still lacks check and balance resulting in huge leakages in revenue on account of fraud claims through ‘flying invoices.’
This fact is also accepted by exporters at large who say that by creating dummy companies the suppliers normally do not submit the ST amount deducted at source from a buyer which gives them room to issue fictitious or ‘flying invoice’ against their deals.