Karachi Chamber disagrees with FBR tax collection analysis

Karachi Chamber disagrees with FBR tax collection analysis

KARACHI: Karachi Chamber of Commerce and Industry (KCCI) has expressed disagreement with the analysis released by the Federal Board of Revenue (FBR) regarding tax collection by cities and markets.

Agha Shahab Ahmed Khan President KCCI in a statement on Tuesday expressed total mistrust over the statistical figures recently disclosed by the FBR in its Tax Directory Analysis 2018.

He said that FBR recently released an analysis of Tax Directory 2018 based on income tax, in which it made some claims which were based on partial information creating a wrong perception about the income tax collection from different cities while some important information was skipped by which a reader could have verified the data.

President KCCI noted that under this report, Karachi’s income tax collection was reported to be Rs209 billion while district-wise it revealed that Karachi contributed Rs186.3 billion (Karachi Central added Rs9.06 billion; Karachi East: Rs34.09 billion; Karachi South: Rs114.23 billion, and Karachi West contributed Rs28.89 billion) which clearly indicates a discrepancy of Rs23 billion. It was unclear whether Karachi’s share was Rs209 billion in total or the district wise collection was to be added to it.

“This mismatch in income tax collection figures has raised serious doubts amongst business circles who are terming it as yet another conspiracy against Karachi.”

Likewise, he pointed out that the province-wise share was only revealed in percentage terms and the total value was not disclosed anywhere in the document to authenticate the claims.

Even while disclosing the income tax collection from major markets, many important markets including the DHA’s Gold Mark & Khadda Market and other important markets of Malir, Korangi, Banaras and Bahria Town etc. were not included in the data which gave a wrong impression that the tax collection from Karachi is low in comparison of other cities.

President KCCI further stated that the selected market data of the cities constituted just 25.7 percent (413,859 filers out of 1,606,424 non-salaried individuals and AOP filers), making it an incorrect estimate of the size and share of any city. President KCCI added that the data analysis given by FBR is just a number game and it is an attempt to undermine the share of Karachi.

According to the said document, the income tax collection of Rs209 billion from Karachi is very close to Rs204 billion collection from Islamabad which is impossible keeping in view the size, population and the immense industrial & economic activities in Karachi.

“We totally disagree to FBR’s analysis as Karachi is a port city where most of the Head Offices of multinational companies, banks, DFIs and insurance companies etc. are based while the highest number of institutions, hundreds of commercial markets, shopping malls and plazas etc. are also present in this city, making it the country’s leading industrial and commercial hub.

How could Islamabad with a population of just 1 million and negligible industrial activity compete with Karachi which holds a whopping population of around 20 million that makes it one of the largest cities of the world with seven industrial zones hosting thousands of industrial units?

He said: “Such pitiful attempts had been made in the past as well which were widely protested and completely rejected by KCCI and it has been proven from time to time that Karachi contributes the highest revenue of around 65 percent revenue to the national exchequer which has also admitted by the decision makers like Federal Minister Asad Umer and many others.

Karachi has always been the leading contributor of revenue to the national exchequer, hence we fear that FBR’s figures have been finalized cunningly through statistical juggling and it is a conspiracy to tone down the significance of Karachi which will not be accepted and widely protested at all available platforms”, Agha Shahab warned.

He requested Prime Minister Imran Khan and his entire team of economic experts to look into this serious matter and grill the FBR for releasing such an irresponsible analysis, besides directing the revenue collection authority to immediately withdraw the fabricated analysis and issue a revised version which must carry comprehensive and accurate fact and figures about Karachi.