FBR Chairman Urges 'Transparent Deterrence' To Snare Wilful Tax Defaulters

by Jason Gorringe Tax, News.com, London

22 October 2008

The chairman of Pakistan's Federal Board of Revenue (FBR), Ahmad Waqar, has asked sales tax officials to follow new compliance guidelines to improve enforcement.

Speaking late last week, Mr Waqar stated: "There should be transparent deterrence against wilful defaulters and this should be the sole criterion for judging the performance of sales tax officers."

The FBR has said that due to "concerted efforts and team work," the sales tax target has been surpassed and is beginning to make up for lower than forecast direct tax collections.

However, tax investigators have been urged by the FBR to actively pursue delinquent tax cases, and, where necessary, take them to court.

The department also wants more information sharing between direct and indirect taxes and field officers. With this in mind, a committee of sales tax and direct tax officers has been constituted.

Pakistan has, for the first time, begun a programme to analyse data for the purposes of calculating the 'tax gap' between what is legally owed by taxpayers, and what is actually paid to the government.

The FBR chairman also expressed concern over the accumulation of sales tax refunds and a high number of complaints regarding deliberate delay in disposal of refunds. He has ordered bona fide claims to be "disposed of expeditiously and in a transparent manner."

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