7.5 million new taxpayers likely in new fiscal: FBR

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KARACHI: As the Federal Board of Revenue (FBR) assumes the “Big Brother’s” role with new powers and access to hitherto prohibited bank accounts data of ordinary people, it has estimated that 7.5 million new taxpayers will be available for filing income returns in the next fiscal year once the amended Finance Bill 2013-14 is passed by parliament, official sources said on Friday.

 

The amendments mean that the authorities can acquire real-time data of account holders as 99 percent of all the transactions made in the country will be filtered through the FBR databank, the sources said.

 

The sources said the databank would only be operated by authorised FBR officials. Even the Pakistan Revenue Automation (Pvt) Limited (PRAL), the FBR subsidiary, will not have the authority to get access of this data.

 

“The databank will be maintained at the FBR headquarters in Islamabad,” a source in the FBR said. “It will have connectivity with the State Bank of Pakistan (SBP), commercial banks and other financial institutions, National Database Registration Authority (NADRA), and the data of people in the telecom sector,” he added.

 

“No one will be able to carry out evasion in sales tax and income tax,” the sources said.The FBR will start maintaining the databank after the proposed authorisation through the Finance Bill, 2013 is received — with respect to obtaining information from financial institutions.

 

The Finance Bill, 2013 has proposed the insertion of a new section (165A) in the Income Tax Ordinance, 2001 under which every banking company will have to provide details of transactions and accounts.

 

This includes online access to its central databank containing details of its account holders and all transactions made in their accounts; a list containing particulars of deposits aggregating rupees one million or more made during the preceding calendar month; a list of payments made by any person against bills raised in respect of a credit card issued to that person, aggregating to Rs100,000 or more during the preceding calendar month — and a consolidated list of loans written off exceeding Rs1 million during a calendar year.

 

The authorities would also receive a copy of each Currency Transactions Report and Suspicious Transactions Report generated and submitted by it to the Financial Monitoring Unit under the Anti-Money Laundering Act, 2010.

 

The bill also proposed amendment to Section 165 of the Income Tax Ordinance, 2001 for removal of doubt about sharing data. That’s because — in the past — most banks had refused to share the data taking advantage of several other prevailing laws.

 

The proposed amendment reads: “For the removal of doubt, it is clarified that this sub-section overrides all conflicting provisions contained in the Protection of Economic Reforms Act, 1992, the Banking Companies Ordinance, 1962, the Foreign Exchange Regulation Act, 1947 and the regulations made under the State Bank of Pakistan Act, 1956, if any, on the subject, in so far as divulgence of information under Section 165 is concerned.”

 

The FBR sources said that the databank would also have linkages with all the corporate entities and their information regarding sales/supplies to tax registered and unregistered persons.The databank would also have linkages with provincialexcise departments, property/land revenue department and federal authorities such as DHAs and CDA.

 

“It will provide the information of transaction regarding motor vehicles as well as property, houses and multi-storyed buildings,” a senior official at the FBR said on condition not to be named.

 

The FBR recently connected the information of all imports and exports with its main databank and customs authorities are bound to share all the information.The sources said that acquiring bank account holders’ data was not a new idea as it has been practiced in several developed and developing economies.

 

“The EU countries and the US already established such information system with their Inland Revenue departments,” the official said. “Whereas Turkey, Brazil and Argentina enforced such measures to detect tax evasion,” the official added.



Courtesy:   The News


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