Islamabad:
In a surprising disclosure, the Pakistan Tax Head said on Monday that there were almost 12 Pakistanis who declared a wealth of 10 billion rupees ($ 36 million) or more in their declarations – a statement that shows the collapse of tax machines and its inability to extend the narrow bases.
The president of the Federal Board of Return (FBR), Rashid Langrial, made the declaration of his defense to stop economic transactions such as the purchase of goods, the car or the maintenance of a bank account by non -eligible people, or declarants or non-sequences.
“Only 12 people have declared assets of more than 10 billion rupees in the past year, which is enormous under the declaration,” Langrial said to the sub-comity of the Standing Committee of the National Assembly on the Question of the restrictions offered in the real estate sector.
The meeting was chaired by Bilal Azhar Kayani, member of the National Assembly (MNA) belonging to the Muslim League of Pakistan-Nawaz (PML-N).
“Only 12 people with an officially declared wealth of 10 billion or more rupees do not reflect the true wealth of Pakistanis. There are hundreds of housing companies in Pakistan and many dozen around Islamabad and Rawalpindi,” continued The president of the FBR.
India has more than 100 richest people with a net value in billions of dollars. The value of the richest person in India is $ 3.3 billion, while their richest person – the net value of Mukesh Ambani is $ 119.5 billion, according to forbes.
“For 78 years, we have been running the country on apology that widens the tax base can undermine the economy and it is not only the FBR responsibility to extend the tax base and manage the country’s system “. pointed out President FBR.
Langrial stressed that economic activities should have a link with the personal wealth of the people.
The government has proposed to disrupt economic transactions by persons whose income statements do not support these major purchases. There is also a proposal that only these people can buy the property, whose declared assets can take care of these transactions. If the value of the declared assets is RS100, the buyer can buy a property of maximum value to Rs130, depending on the proposal.
The FBR should consider exempting reconciliation up to 50 million rupees, which will allow people to declare their assets, recommended Arif Habib. “The bill is very dangerous and leaves buyers and sellers of the property at the mercy of people ready to exploit,” he added.
Habib also said that companies have been seriously affected lately and that people only invest gold and dollars.
What is the need to introduce a proposal to stop the purchase of properties by ineligible persons when persons have the legal obligations to produce their income statements and wealth statements at the end of the fiscal year, noted Kayani , the committee manager.
During the last financial year, just under 1.7 million real estate transactions were carried out and 93.7% of transactions had a value of less than 10 million rupees, said Langrial. He added that there were only 2.5% transactions that would be affected by new legislation.
“Our goal is to target only 2.5% of households,” said Langrial. However, Ashfaq Tola, the president of the Tola associations – a tax consulting company – warned the FBR not to disturb the system for 41,801 or 2.5% of transactions.
The FBR should not bring the entire real estate sector under the clouds for these few thousand transactions, he said. Tola added that if the FBR could not manage these 41,801 people without disturbing the whole system, there was a serious questioning point on the capacity of the system.
The FBR had shared the thesis in terms of value of 1.7 million real estate transactions in the past year. Only 3 250 transactions with a value of more than 50 million rupees were declared with the property registration authorities last year.
Real prices are much higher than the declared values of these properties at the time of recording, said Mna Jawad Hanid Khan.
The FBR should first explain the results of the blocking powers of SIM cards and to disconnect electricity and gas connections before requesting new powers, said Mna Usama Ahmed Mela.
Langrial said that taxes could not be recovered by normal means before the whole system has been modified, all FBR officers were honest and that civil laws were reformed. He admitted that there were thousands of people who bought properties each year, they were declarants but who still did not disclose these assets in their return.
“The decision to stop the real estate transactions of ineligible persons would open new paths of money laundering in Pakistan,” warned the MNA Muhammad Mobeen Arif. Langrial replied that the FBR was aware of the fact that the housing sector had been assigned and “the FBR has a role in it”.
In order to reverse the trend, he added, the government was seriously planning to reduce taxes on real estate transactions, subject to certain approvals.
Dr. Hamid Atiq Sarwar, FBR member operations, said that in the first half of this financial year, 735,000 real estate transactions had been carried out and to which 500,000 transactions were non-sequences. He said the audits after purchase of assets did not help, because the success rate was only 3%.
“The proposals are no longer in the hands of the FBR and it is now up to the permanent committee what type of decision it takes,” said Langrial.
The subcommittee would meet again on Thursday to offer a path to follow.
It appeared during the discussion that the panel could recommend to the National Assembly that, in the event that the value of the property was less than 10 million rupees, it should not be required to justify the source of ‘Purchase of property.
