LAHORE – Federal Board of Revenue (FBR) has rolled up his sleeves to boost the thin taxbase. FBR is planning to gain complete access to the existing national and provincial databases to tap the tax potential. Meeting minutes of a recent broadening tax base (BTB) exercise show that FBR is seeking complete access to provincial land and properties records and vehicle registration and transfer transactions.
FBR is planning to establish retrievable access to existing databases, including National Database and Registration Authority (NADRA), Securities and Exchange Commission of Pakistan (SECP), State Bank of Pakistan (SBP), Oil and Gas Regulatory Authority (OGRA), National Electricity Power Regulatory Authority (NEPRA), Pakistan Telecommunication Authority (PTA) and other relevant bodies.
In addition, to maintain a comprehensive database, FBR will monitor future and ongoing transactions in real estate, motor registration, stock exchanges, imports, exports and banking transactions. FBR chairman has directed the tax authorities to set up a comprehensive and authentic central database and access available federal and provincial data sources. In the meeting, FBR Chairman Salman Siddique pointed out that the success of the BTB exercise was mainly dependent on the development of an authentic data source. He pointed out that the FBR’s effort was not focused on the collection of data and even available information could not be utilised effectively.
He stated such a collection mode and its inherent time gap provides sufficient time for manipulation and corruption, resulting in most information not being processed effectively and increasing incidence of tax evasion. Though the existing process need to be centralised, automated and made efficient, yet tapping of the ongoing transactions is need of the time, he added.
In the BTB exercise meeting, several proposals were discussed. It was pointed out that in the case of the provinces, all tax potential transaction are fully documented. The record is maintained in a rational manner and supervisory framework is integrated to a large extent.
It was indicated that the provincial board of revenues are the custodians of registered deeds, mutations and registered lease deeds of all types and in permanent record. Provincial housing departments control different urban development authorities which also transact in real estate and all transactions are fully documented.
Provincial cooperatives also supervise cooperative housing societies which deal with transactions real estate and once again the whole trial is documented. Provincial Excise and Taxation departments maintain and supervise registration and transfer of vehicles, apart from maintaining unmovable properties. Provincial education departments register and supervise private educational institutions and hold useful information on said entities. Provincial mineral departments grant and maintain record of mining lease. As all information is already available with government agencies, it was that one copy of the document in question is sent to the FBR’s Central Database.
It would incur only a negligible expenditure, which could even be justified from the divisible pool of the federal government. It was pointed out that no legislation is required to gain access to these information sources as all this information is already public property. In addition, these exercises would help to enhance the capacity of the provinces in increasing tax collection and tapping new tax avenues.
