KARACHI: The Federal Board of Revenue (FBR) is expecting significant tax collection under an amnesty scheme for local and foreign assets expired last year but it is open to payment with default surcharges till June-end next year, sources said on Monday.
The sources said the tax payment would be received from individuals who filed declaration of their assets, but opted to pay with default surcharges.
The sources said the estimates of amount to be collected under the head are not available. However, the sources said the collection under the head would be a significant support to the overall revenue collection for the fiscal year of 2019/20.
The present government introduced a tax amnesty scheme through a presidential ordinance on May 16, 2019. The last date for filing returns under Asset Declaration Ordinance 2019 was June 30, 2019, which was extended to July 3, 2019. It was the first time that the government allowed declarants to pay taxes under the tax amnesty scheme till June 30, 2020 subject to the returns filed by due date.
The sources said the declarants were allowed late payment with 10 percent default surcharge on total tax due by September 30, 2019. Individuals were allowed to avail the amnesty scheme to pay 20 percent of the tax due to validate their returns by December 31, 2019.
The sources said taxes can be paid till June 30, 2020 but with 40 percent penalty on the actual declared amount.
The FBR’s provisionally collected Rs1.608 trillion during the first five months (July – November) 2019/20. The FBR is required to further collect Rs590 billion in December 2019 to achieve the half-year target of Rs2.198 trillion.
The actual revenue collection target for the FBR was Rs5.550 trillion for the fiscal year 2019/20 as agreed under the International Monetary Fund (IMF) loan program. However, the IMF revised downward the collection target to Rs5.238 trillion for the current fiscal year.
The sources said the present government would not issue any further tax amnesty scheme till the finalisation of IMF loan program.
The tax offices of the FBR have been reminding the individuals who file declaration for availing amnesty scheme to pay their taxes along with default surcharges by December 31, 2019.
As per the amnesty scheme, the government allows to document the concealed assets other than immovable properties at 4 percent.
Meanwhile, the undeclared immovable property was allowed to whiten at 1.5 percent. The amnesty scheme also allowed for the first time to declare sales, which were undisclosed to evade sales tax, at 2 percent.
(This news/article originally appeared in The News on December 31st, 2019)