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 Tax recovery figures drop to abysmal lows

Tax fallout likely to trigger financial difficulties for the provincial govt

By Imtiaz Ali

Karachi

The Sindh Government is likely to face fiscal problems in the forthcoming financial year (2009-10) as different departments have recovered taxes below the set targets for the year 2008-09 owing to various reasons, official sources told The News.

Four provincial departments, namely Prisons, Power and Irrigation, Food and Local Government, performed the worst with regards to recovery of taxes, sources informed. They added that, during the financial year 2007-08, tax recovery was almost 100 per cent for most departments. However, during the last 10 months of the outgoing financial year, the recovery was only 20 per cent, triggering fears of financial difficulties for the provincial government.

The Excise and Taxation Department, for one, set a target of Rs6 billion for motor vehicle tax. However, during the last 10 months, the department collected only around Rs3billion.

The Agriculture Department has fared even worse. Of the target of Rs350 million, the recovery has amounted to only 32 per cent.

The Board of Revenue was given a target of Rs250 million to be collected through land revenue. However, it, too, has achieved only half of its target.

The Food Department, with a target of Rs15 million for the year, has also failed to recover its target, revealed sources. With the same output since the last three years, the recovery for the food side (economic services receipts food) includes renewal fee of Chakis, flour mills fee, registration and licence fee of flour chakis etc. Department officials assert that they have been submitting this amount in “Account-I”, but the finance department has instructed them to submit the money under the proper head of account, which is not being done.

The Fisheries Department was given a target of Rs15 million, but so far the department has only recovered about three per cent of the estimated target. Sources said that the former provincial government had given contracts of fish ponds to certain influential persons and even law-enforcement agencies without extracting any charges from them.

The Labour Department also failed to collect receipts under the head of manpower management (fee on technical colleges etc). It was given a target of collecting Rs22 million but so far the department’s recovery has amounted to only 17 per cent. The Public Health Engineering Department was required to collect Rs22 million; however, it collected barely above 19 per cent of its target.

The Cooperation Department was given the task of recovering taxes from cooperative societies etc., but it has only accumulated approximately 30pc of its target of Rs3 million.

The Power and Irrigation Department was given a target of Rs886 million for electricity duty for the financial year, but, during the last 10 months, it collected only about 8 per cent of its target.

The Local Government Department was also unable to meet its target of Rs32.5 million under the head of account of fiscal administration audit, collecting only 6 per cent of the estimates.

The Prisons Department was given the target of recovering Rs3.5 million; however, it too failed and made an almost negligible recovery of a little over one per cent.

The performance of the Civil Defence Department for recovery was zero. Sources said that Civil Defence comes under the Home Department but it has been devolved to the district governments. However, the employees are still receiving their salary from the Sindh government.

The News:  Sunday, June 14, 2009