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Sindh planned to collect Rs200bn tax to up revenue

Karachi: Sindh intends to increase its tax receipts from the current Rs91.37 billion to Rs200bn over the next three years.

Currently, the provincial tax receipts account for 17pc of total revenue receipts of the province.

To engage the major stakeholders in the exercise to increase provincial revenue through a series of fiscal reforms, a Taxation Forum was organised by Department of Finance, Government of Sindh in collaboration with Institute of Business Administration (IBA) and the World Bank.

Speaking on the occasion Syed Murad Ali Shah, Adviser to Chief Minister on Finance and Energy, emphasised the need of reducing reliance on federal fiscal transfers for implementing government policies.

He said under the 18th Amendments, the Sindh government took the responsibility of colleting sales tax on services and even during the initial years it collected more than what Sindh used to receive from federal government under this head.

He acknowledged a significant gap between the potential and realisation because tax system was not sufficiently upgraded and automated over time.

On the occasion the chairman Sindh Revenue Board (SRB) shared the performance by showing an increase of 31.25pc in 2013-14, against an increase of 28pc in 2012-13. He said the SRB plans to collect Rs100bn by 2017 by expanding its tax base from 6,000 to 10,000 and beyond.

The SRB collected a record tax during the last four years since sales tax on services has been devolved to the provincial government. The director general Excise and Taxation informed the moot that over the last five years their tax collection had increased from Rs10.58 to Rs27.01bn. After proposed reforms, the department estimates to take its tax receipts up to Rs55bn.

In his presentation, member Board of Revenue highlighted the role of computerisation of land records which will help identifying land owners who can then be taxed.

The Sindh secretary finance identified the various loopholes in the provincial tax collection process and stressed the need of better coordination between the tax collecting agencies by establishing Tax Reforms Unit.

Director Enforcement, Sindh Public Procurement Regulatory Authority (SPPRA) said it was the right of taxpayers to know how and where their taxes were being spent.

Dr Qazi Masood, Director Centre for Business & Economic Research, IBA, emphasised on the linkage between academia and the government through setting up of a consortium of reputed research institutions to provide research support to policymaking.

Dr Mushrraf Cyan, tax expert at Research International, emphasised on filling the gaps by focusing on not only increasing tax base but also making it equity concerns.

Shabbar Zaidi, former provincial finance minister, highlighted various issues still need to be straightened out after the 18th Amendment.

 

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