ISLAMABAD (August 02 2005): The Central Board of Revenue (CBR) has launched an exercise to raise general sales tax (GST) collection from the large-scale manufacturing units to meet the ambitious target of Rs 690 billion in fiscal 2005-2006.
Sources told this correspondent on Monday that there is a visible gap between the growth in the large-scale manufacturing sector and growth of revenue receipt from this sector. According to CBR estimates for 2005-06, the expected growth from these units is around 15 percent.
The CBR has issued instructions to all Collectors of sales tax to analyse such gaps in each sector to improve tax-GDP ratio. The large-scale manufacturing units could play a key role in improving GST collection in 2005-06.
They said that the collection of Rs 591 billion in 2004-05 is only 9 percent of the GDP and target of Rs 690 billion fixed for 2005-06 is merely 9.2 percent of the expected GDP. During 2005-06, tax-GDP ratio declined by 0.4 percent which is alarming for those responsible for revenue collection. Therefore, there is a need to be alert right from the beginning of the new financial year.
To increase sales tax and tax-GDP ratio, the CBR has also given new assignment to the Collectors to carry out sector-wise revenue analysis and plug the loopholes so that the revenue deficiencies are covered good through systematic monitoring.