ISLAMABAD (January 01 2003) : The Central Board of Revenue (CBR) has decided to acquire the services of industrial specialists to detect under-assessment/reporting and tax evasion in leading sectors like sugar, cement and textile to enhance revenue collection.
A senior CBR official on Tuesday said that these specialists should not be misinterpreted as economic managers, but a person who is well acquainted with the working of industrial units.
Such professionals would be an integral part of the CBR team and would give technical assistance to uncover hidden revenue generation areas.
They would accompany the CBR officials while scrutinising the tax data to pinpoint the methodology adopted by these units to evade tax authorities.
The industrial experts would be well versed with the intricacies of the system in practice to determine actual production for the assessment of tax.
The CBR is also formulating a new mechanism to search and hunt the manufacturers of counterfeit goods.
Under the procedure, the CBR has sought all the details of the industrial and commercial consumers from the Wapda.
This data would be instrumental in analysing the specification of goods being produced, production capacity of the said units and tax paid by them. If any one is found guilty of producing fake items he will face action as admissible under the law.
The main purpose of this exercise is to have a comprehensive database of taxpayers to make the system more effective brining maximum taxpayers into the tax net.
The CBR has also decided to constitute inter-collectorate committees on city level and joint co-ordination regional and zonal committees at region and zone levels.
These committees will include Additional Collector of Customs, Additional Collector Sales Tax and two Additional Commissioners of Income Tax (ACITs).
They will compile data of the potential taxpayers and will utilise the same for actual determination of duties/taxes.
He explained that the committees would provide an opportunity to both the sales tax and income tax officials to share knowledge for reaching the correct conclusion.
This would develop new culture among the tax officials and would help in checking tax evasion.
The CBR official accepted that the real test would be for the tax authorities at the Medium Taxpayer Unit (MTU) at Lahore where over 4000 medium traders including commercial and industrial units would be facilitated.
“We have given VIP status to 294 largest taxpaying units at LTU Karachi. However, if the experiment at Lahore succeeds, MTUs would be established in other major cities as well.”
He pointed out that the manufacturers of excisable commodities are switching from Supervised Clearance Procedure to Self-Clearance.
The main problem with the Supervised Clearance for the excisable commodities was that the concerned industries always make allegations that excise people remain present at the time of clearance of excisable items.
However, the industries operating under Self-Clearance Scheme could not give such type of statement.
On customs side, the CBR is zooming in on two areas ie comprehensive programme for compiling valuation data relating to imports and risk profiling of commodities/importers.
In order to streamline the work relating to tax reforms schemes being financed with the advance by the World Bank, the CBR has established a Project Co-ordination Section under Projects Co-ordinator (BS-20) who will be assisted by Secretary Projects (BS-19)/Second Secretary (BS-17/18), Secretary (Expenditure-Tax Reforms), Second Secretary (Accounts-Tax Reforms).
The Second Secretary (ATR) and Secretary (Expenditure-Tax Reforms) shall ensure that project accounts are maintained in accordance with the requirements of the government and the World Bank.
The approval of expenditures relating to tax reforms project would be given by committee comprising Financial Adviser (CBR), Member (Admn), Member (P&TR). Final approval will be granted by the Chairman, CBR.
The payment from the project accounts to Consultants and Contractors will be made after the approval of the above Committee.
The Projects Co-ordinator will also sign the bank cheques and other related documents concerning payments.
The Secretary Projects will prepare requisite documents relating to procurement of goods and works for various schemes, PC-I/II etc. He shall also monitor the quality of the supplies and civil works relating to reform project.