Those who at times were opposing the move for allowing Sindh authorities to collect the general sales tax on services after the consensus was made on the 7th National Finance Commission (NFC) Award, are now requesting financial experts to help them establish boards to collect levies.
The three provinces – Punjab, Balochistan and Khyber Pakhtoonkhawah – initially against the transfer of powers to province particularly to Sindh, changed their stance after Sindh’s authorities proved their words in their performance.
In this regard, a formal written application has been forwarded to the authorities of Sindh Revenue Board, besides it was also discussed when the finance authorities of Punjab, Balochistan and Khyber Pakhtoonkhawah visited the office of the Sindh Revenue Board (SRB) in recent days, well-placed sources told Pakistan Today.
Sindh was the province that stuck to its demand for collecting GST on services, however, the three provinces – Punjab, Khyber Pakhtoonkhwah and Balochistan – had authorised the Federal Board of Revenue (FBR) to continue the job.
Sindh started tax collection from July 1, 2011, after establishment of the SRB with an initial tax collection target of Rs 25 billion on more than 4, 500 companies.
Interestingly, the revenue collection target was achieved a month before the start of new financial year 2012-13 and the performance of the Board has proved its words that Sindh has the ability to collect taxes on GST on services after the consensus was made on the 7th National Finance Commission (NFC) Award.
While presenting Sindh’s Budget on June 11, Finance Minister Syed Murad Ali Shah also highlighted the performance of the revenue board saying: “Sindh Revenue Board clearly proves that the apprehension of the detractors that the provinces do not have the capacity to manage the collection of sales tax on services was unfounded.
“The 7th NFC enhanced the share of federating units in the divisible pool and recognized the constitutional right of provinces to collect sales tax on services if they so desire.
Sindh Revenue Board was mandated to collect Sindh sales tax on services from July 2011 and is expected to successfully achieve its current year’s target of Rs 25 billion against receipts of Rs 18.3 billion by FBR in 2010-11. Our confidence and faith in SRB can be gauged from the fact that for the coming year 2012-13, we have kept the sales tax on service collection target at Rs 32 billion”, the minister added.
Sources said Sindh finance officials recently visited three provinces to help them establish their respective revenue boards so that they could collect the GST on services at their own instead of relying on the Federal Board of Revenue.
