Govt targets revenue leakages: Aurangzeb
Islamabad: Finance Minister Muhammad Aurangzeb said that the government was committed to addressing revenue leakages and boosting trade and investment. Addressing the Overseas Investors Chamber of Commerce and Industry, the minister highlighted the initiatives the government has taken for the digitalization of the revenue structure and to increase transparency and friendliness of the tax system.
Aurangzeb said data analytics can also be used by the tax authorities to track and curb tax fraud. He said that data for income and sales taxes for companies, categorized by sector, have already been collected by the government as part of detecting such irregularities.
Taking the beverage sector as a case in point, the finance minister disclosed a significant gap in the claimed sales tax adjustments of various companies. While Coca-Cola has set a benchmark tax adjustment rate of 7%, other companies in the sector have reported claims as high as 20%.
This is supported by the study conducted by the Federal Board of Revenue, whereby 16 active cases in the aerated water manufacturing sector were analyzed. The study covered 99% of reported sales in the sector and found an excessive input tax adjustment worth Rs15 billion in the fiscal year 2023-2024.
