ISLAMABAD-Federal Board of Revenue Chairman Tariq Bajwa on Tuesday said Committee constituted on reviewing tax exemptions would recommend the government that tax concessions worth around Rs 240 billion (0.9 per cent of the GDP) could be withdrawn in upcoming budget 2014-2015.
Tariq Bajwa, briefing the Senate Standing Committee on Finance and Revenue that met with Senator Nasrin Jalil in the chair, said that government would withdraw tax exemptions worth Rs 480 billion in next three years. The committee would suggest the government that tax exemptions worth Rs 240 billion could be withdrawn in the budget 2014-2015, which would be announced in first week of June 2014, he added.
He further said that government had constituted a high level committee to review tax exemptions granted through Statutory Regulatory Orders (SROs), which would complete its recommendations during current week. It is worth mentioning here that the government had constituted a committee under the chair of Finance Minister Senator Ishaq Dar to examine the tax exemptions worth Rs 480 billion. The government has agreed with International Monetary Fund (IMF) to eliminate these exemptions in next three years (starting from 2014-2015 and ending in 2016-2017).
The FBR chairman neither disclosed the tax collection target for next financial year nor the revenue collection measures to be taken in the upcoming budget. However, he was optimistic that FBR would achieve the twice-revised revenue collection target of Rs 2275 billion by the end of June 2014, as the board has collected Rs 1575 billion in ten months (July-April) of the outgoing fiscal year. He briefed the committee that government had twice revised the tax collection target, first from Rs 2475 billion to Rs 2345 billion and then to Rs 2275 billion.
Tariq Bajwa held that decrease in imports was mainly because of rupee appreciation, which was responsible for the lower revenue collection. He was of the view that tax collection could go beyond Rs 2275 billion if imports witness normal growth of 8-10 per cent in remaining two months (May and June) of the outgoing financial year 2013-2014.  
The Senate Standing Committee on Finance and Revenue recommended the government to present the ‘Tax Reforms Bill’ in the parliament to broaden the extremely narrow tax base of the country. Pakistan Peoples Party had moved a bill in parliament to ‘Tax Reforms Bill’ to bring non-taxpayers into tax net; otherwise government should cancel their national identity cards.
Chairman FBR informed the committee that government is working to broaden the tax base of the country, as it issued notices to some 90,000 non-taxpayers during outgoing financial year wherein 8600 people have filed their returns. He assured the committee that there would be improvement in move of broadening tax base of the country. The government would also issue notices to 1,00,000 non-taxpayers in next two years. The process of broadening tax base would take 5-8 years.  Chairman FBR denied that tax department has any list of non-taxpayers. “I did not see any list in FBR regarding numbers of non-taxpayers of the country”; Tariq Bajwa said and added that FBR and NADRA could jointly formulate a strategy to bring non-taxpayers into tax net. FBR is taking data of non-taxpayers from various sources including collecting data of land transactions, data of purchase of expensive vehicles and data of those people who frequently traveled abroad but did not contribute.
The committee was informed that FBR has cleared 20,000 refund cases last month (April), which is highest figure in last few years. FBR has refunded Rs 89.3 billion during ongoing fiscal year, which is 16 per cent higher than the refund amount of previous year. Chairman FBR informed the committee that tax to GDP ratio would enhance to nine per cent during current financial year 2013-2014 from 8.3 percent of the previous financial year 2012-2013. He added that provinces tax to GDP is only one percent.
The committee was informed that about 90 million national identity cards were issued whereas 850,000 people in the country have National Tax Number. Similarly, about 711,000 people have deposited their tax during last financial year. The Committee also formed a Sub Committee comprising Senator Saleem Mandviwalla and Nuzhat Sadiq for looking into tax exemption in high paid fee for diplomats and others and to submit its report after deliberations.
Senator Saleem Mandviwalla of Pakistan Peoples Party said that government should bring tax reform bill in parliament to broaden the tax base of the country. He added that government should take innovative measures to bring non-taxpayers into tax net. He claimed that unofficial economy in the country was larger than the official economy.