Single Sales Tax Return

By Published On: September 16, 20222.8 min readViews: 581

Single Sales Tax Return

By Published On: September 16, 20222.8 min readViews: 581
Single Sales Tax Return
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The Federal Board of Revenue (FBR) will start execution of single sales tax return from the province of Punjab as a simultaneous implementation may create issues for the taxpayers, said Zain-ul-Abidin Sahi, Chairman Punjab Revenue Authority (PRA).

He said this while talking to Business Recorder on Wednesday.

According to him, necessary changes would be incorporated into the provincial sales tax law once the single return is fully developed. Pakistan Revenue Automation (Pvt.) Limited (PRAL) is expected to finalize timelines, in consultation with PRA, for various steps, including testing, quality assurance, launching, and feedback, by next week. He added that the execution of single tax return is likely to start early next calendar year.

Sahi said the harmonization of FBR and provincial revenue authorities is moving satisfactorily. The identified issues relating to definitions of goods and services, place of supply, and single return are close to being resolved. We have witnessed excellent cooperation and national spirit in deciding contentious issues relating to the sales tax collection from restaurants, toll manufacturing, transportation of petroleum products, and construction, which are now settled between the Board and provincial revenue authorities.

When asked about the results of the research undertaken by Mahboobul Haq Research Centre (MHRC) on the working of PRA, he said the report is expected to be shared during the ongoing month. He said that MHRC had finalized its working on the Authority’s Electronic Invoice Monitoring System (EIMS) and its impact on revenue. According to its findings, the declared tax collection of restaurants with the installation of EIMS is substantially higher than similar restaurants without it.

The PRA came into being in 2012, and the FBR had transferred Rs22 billion under the head of sales tax on services to Punjab then. After 10 years, tax collection by PRA for the first two months (July and August) of 2022 is higher than Rs28 billion, while the financial year 2021-22 was closed on a tax collection of Rs170.1 billion. This is an almost eight-fold growth over the last decade, which suggests that the direction and growth of PRA are on the right track.

He said the collection target for the current fiscal year is Rs190 billion and that PRA is making all-out efforts to achieve and even surpass the said target. He hoped that if all plans worked out well and the economy moved towards stability, the PRA might end this financial year with a collection of close to Rs200 billion. Our focus is on raising awareness among taxpayers through workshops rather than exercising the powers of sealing bank account attachments or other coercive measures. There were hardly four bank attachments over the last three years.

The Chairman said he was following an open-door policy. We have organized over 500 workshops during the last two years. Similarly, a special desk was set up to guide taxpayers, besides updating our website with all registration, return filing, and payment guides. A complaint and facilitation portal has been launched, which is being monitored by the Chairman. Similarly, new technologies are being used to broaden the tax net through web scraping. Interaction between taxpayers and tax collectors is minimal, with maximum reliance on information technology. He added that a new application is being developed to identify potential taxpayers and update their data electronically instead of directly interacting with taxpayers to avoid the element of harassment.

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