KARACHI - Putting down the speculation that Sindh had no expertise to collect general sales tax (GST) on services, the Sindh Revenue Board (SRB) has succeeded in achieving the target of collecting Rs 25 billion tax during 11 months before the closure of financial year - July 1, 2011 to June 1, 2012.
The performance of the board has proved its words that Sindh has the ability to collect GST on services after the consensuses were made on the 7th National Finance Commission (NFC) Award.
Interestingly, Sindh was the only province that pleaded its case to collect GST on services, however, three provinces including Punjab, Khyber Pakhtunkhwa and Balochistan authorised the Federal Board of Revenue (FBR) to continue the job.
Sindh finally started tax collection from July 1, 2011, after establishment of the SRB, with an initial tax collection target of Rs 25 billion on more than 4,500 companies, well-placed sources told Pakistan Today.
The sources said the financial experts of Sindh had worked out the tax collection target of various firms operating in the province and set the initial tax collection target at Rs 25 billion that would be increased gradually.
According to the initial estimates, Sindh was supposed to collect at least Rs 1 billion sales tax from the banking and non-banking companies in the financial year 2011-12.
Furthermore, it was suppose to collect Rs100,000,000 sales tax collection from advances and loans, brokerage (Rs100,000,000), commodity leasing (Rs100,000,000), equipment leasing (Rs100,000,000), financial leasing (Rs100,000,000), foreign exchange transactions (Rs100,000,000), guarantees (Rs100,000,000), letters of credit (Rs100,000,000),
Musharika financing (Rs100,000,000) and Rs 100,000,000 from other non-banking sources.
Moreover, at least Rs250,000,000 from the services provided by the architects, town planners and interior decorators, services provided by persons engaged in contractual (Rs250,000,000), services provided by courier and logistic companies (Rs250,000,000), services provided by event managers and organisers (Rs250,000,000), services provided in matters of hire, lease, purchase and other (Rs 500,000,000), services provided by hotels, restaurants, marriage halls (Rs750,000,000), services provided by insurance (Rs750,000,000), services provided by laundries and dry cleaners (Rs250,000,000), services provided by medical diagnostic laboratories (Rs250,000,000), services provided by persons authorized to transact (Rs750,000,000), services provided by pathological laboratories (Rs250,000,000), services provided for personal care by beauty parlors (Rs250,000,000), services provided by port and terminal operators (Rs500,000,000), services provided by professional and consultants (Rs500,000,000), services provided by property developer and promoters (Rs500,000,000), services provided by specialized agencies (Rs500,000,000), services provided in specified fields (Rs250,000,000), services provided by specified persons or business (Rs500,000,000), services provided for specified purposes (Rs250,000,000), services provided by specialized workshops or other (Rs500,000,000) and Rs 15,750,000,000 on the services provided by the telecommunication and internet.
The sources informed that the above mentioned targets had been achieved by June 1, 2012 and the efforts were being made to achieve remarkable tax collection.