FBR for close collaboration with provinces for collection of agri income tax.

ISLAMABAD -- In a major development, the Federal Board of Revenue (FBR) has proposed close collaboration with the provincial governments for collection of agricultural income tax, which remained very low in Pakistan.

In line with the government's resolve towards broadening of tax base and documentation of economy, Dr. Muhammad Ashfaq Ahmed, Chairman FBR, has initiated a huge challenge to plug in tax evasion of agricultural income through a close cooperation between FBR and provincial tax authorities to ensure that no taxable income goes untaxed and due taxes are paid in respective collecting jurisdiction. Accordingly, Chairman FBR has issued a letter to all provincial governments for a proactive collaboration. He has offered to coordinate a technical level meeting to address the issues relating to taxable agricultural income and curb tax evasion in national interest.

FBR chairman has proposed technical collaboration between FBR and provincial tax authorities on agricultural income which is taxed by provinces and is exempt from federal Income Tax. Chairman has also highlighted that tax evaders claim agricultural income as exempt in FBR returns and do not pay tax to either FBR or provincial governments. Income Tax ordinance prescribes that agricultural income will be exempt only if provincial income tax is paid on it.

To strengthen the enforcement of tax laws, FBR has extended cooperation to provincial governments by offering to issue system generated notices to taxpayers who declare agricultural income in federal Income Tax Returns, to...