The National Assembly’s Standing Committee on Funding on Thursday ordered the Federal Board of Revenue (FBR) to incorporate protective measures before the closed bank accounts for unregistered companies, in the midst of widespread tax evasion and sub -reporting of business people. The committee, who met here with its chairman Syed Naveed Qamar in the President, reviewed FBR’s proposed measures to enforce caring tax, including interruption of utilities and temporary freezing of bank accounts for non-file. During the meeting, FBR chairman Rashid Mahmood Langrial gave a briefing to the committee. He said unregistered business people would not be able to operate a bank account according to VAT, adding that such a person would get a message before closing the bank account.
"The bank account of an unregistered person will be re -enabled within two days of registration," he said. He revealed that out of 300,000 industrial units in Pakistan, only 30,000 to 35,000 were registered with the authorities. By explaining reasons, he acknowledged that the tax rate in Pakistan was high.
"One third of the manufacturers are not registered in VAT. People who even come under the taxiet do not archive returns," Said Langrial. "Those who pay taxes under -report their incomes," he told the committee. "Electricity theft costs the RS500 to 600 billion alone each year."
When asked how FBR would identify companies that do not pay revenue tax, the FBR chairman explained that the income declared for income tax purposes would be used to estimate the amount of sales, supplies and the total business activity. There will then be action against people who do not register, he added. Committee member Javed Hanif supported FBR’s proposal, but the committee chairman warned against passing a law aimed at catching tax evasion if it also negatively affects compatible companies. Another committee member, Sharmila Farooqi, suggested that taxpayers instead of making the sanctions more stringent, taxpayers should get incentives. "Reduce the tax rate. It will expand the taxi and encourage the people to have them registered. Finance Minister Muhammad Aurangzeb replied that the tax threshold and the process would be improved. However, he made it clear that tax exemptions and amn paths would not be given anymore. "The time of tax exemptions and amn paths have passed. People need to be brought into the tax network."
Langrial urged the committee to allow FBR to temporarily disable the bank account for unregistered business people. However, the committee aimed to include protective measures in the process. Petroleum tax Meanwhile, the committee approved a proposal to increase the frequency of petroleum development tax (PDL) to RS90 and introduce carbon tax on gasoline, diesel and oven oil. The Ministry of Finance’s officials told the committee that there was also a proposal to impose PDL on oven oil. The officials said that RS100 billion in revenue was expected from PDL on oven oil. They added that 1.2 million tonnes of oven oil were imported for 1,000 MW of independent power producers (IPPS). The Secretary of the Ministry of Power said the target of PDL recovery in the financial year 2025-26 was set at RS1,468 billion. The Ministry of Finance’s officials said the government expected RS45 billion in revenue through the carbon tax. The chairman of the committee asked how much the center would get if the tax was transformed into a carbon tax. On it, the officials said the amount in this case would be RS18 billion. The committee was informed that the entire amount of a tax went to the federal government, but in taxes provinces also receive share. The chairman emphasized that the committee did not make any decision on a tax or a tax on oil products. The Secretary of Industry told the committee that RS10 billion from carbon tax would be used to promote electric vehicles. He added that 30% of the vehicles would be moved to electric vehicles by 2030. The production of all types of vehicles in the country is about 150,000, the officials said, adding that there were 76,000 electric vehicles in the country at the moment. "In the next five years, the production of electric vehicles increases to 2.2 million," said the secretary.
