RECORDER REPORT

PESHAWAR: Khyber Pakhtunkhwa Revenue Authority (KPRA) has expressed optimism to achieve a revenue target of Rs 20 billion, set for next financial year 2019-20.

In the budget 2019-20, KPRA has taken drastic measures to revamp its taxable schedule and rationalize tax rates.

Instead of taxing individual services, tax coverage has been linked to 46 classes of services, according to a press release issued here on Monday.

While telecom services are chargeable to tax at the rate of 19.5% and standard rate of tax for all non-telecom services is 15%, tax rate on 13 services has been reduced from standard 15% to four different reduced tax slabs ranging from 2% to 10% and some of the sub-classes of eight services have been given tax relief by applying multiple tax rates.

The press release said that it is understood that such pro-business tax policy in a province which has already suffered due to war against terrorism, will not only promote tax compliance and economic documentation, it will also attract new investments in the province creating new employment opportunities and raising the average standard of living.

In the new financial year, KPRA is opening its new satellite offices in major urban areas of the province expanding its physical outreach and increasing the overall tax base through taxpayers’ education and facilitation.

Necessary human and other resources are being mobilized for this purpose. With the accelerated physical expansion coupled with well-planned rigorous enforcement and audit measures, KPRA will ensure further higher growth in tax collections from non-telecom services.

Despite this unanticipated hit during 2018-19, KPRA collected Rs 10.584 billion against Rs 10.91 billion collected last year. KPRA’s extra efforts on this account brought 43% growth in the tax collections from non-telecom regimes.

Last year telecom sector contributed 48% in the aggregate collections but this year its contribution remained only 23%. Similarly, last year non-telecom sectors contributed 52% but this year their contribution increased from 52% to 77%. During 2018-19, telecom contributed only Rs 2.453 billion against Rs 5.287 billion contributed last year indicating shortfall of 54%.

Receipts from withholding tax regime remained at Rs 1.538 billion as against Rs 1.120 billion last year showing an increase of Rs 424.27 million registering an historical increase of 38%. Services from oil and gas sector contributed Rs 1.438 billion, while all other services yielded Rs 5.15 billion.