No need for RGST if lacunae in tax collection removed: PAC

ISLAMABAD – The Public Accounts Committee on Wednesday observed that if the Federal Board of Revenue removed lacunae in the existing tax collection system, there would be no need to impose Reformed General Sales Tax. The PAC members made this observation when they found that a test check conducted by the auditor general of Pakistan had revealed that the FBR had failed to recover adjudged government dues worth Rs 9.4 billion.
Citing the audit report 2008-09 pertaining to the accounts of FBR (indirect taxes 2008-09), the audit officials told the committee that a test check of recovery registers pertaining to various RTOs and MCCs of the Punjab and NWFP revealed that revenue collection departments did not take adequate measures for the recovery of the government dues of Rs 5.17 billion adjudicated in 432 cases. In various RTOs and MCCs of Sindh and Balochistan, the tax collecting agencies did not take adequate measures for the recovery of Rs 4,299.623 million in 942 cases.”
The FBR officials told the committee that they had recovered the major amount with Rs 2 billion still left. Zahid Hamid who was chairing the PAC meeting in the absence of Ch Nisar Ali Khan said if the FBR plugged loopholes in the tax collection system and speedily collected taxes, there would be no need to introduce RGST-type controversial bills. The audit officials also pointed out that the FBR was not following the PAC directions seriously. “In the said case of Rs 9.4 billion, the PAC directed the FBR on October, 10 2010, to submit a report within two months but the FBR failed to do so,” said AGP Tanveer Ali Agha.