Tax amnesty scheme fetches Rs122 billion

ISLAMABAD: Almost 70,000 declarations for domestic and foreign assets have fetched around Rs122 billion into the national kitty and this scheme has expired on July 31, without any further extension.

“Yes we have collected around Rs122 billion through tax amnesty scheme,” a top official of the Federal Board of Revenue (FBR) told The News on Tuesday. The two tax amnesty schemes known as Voluntary Declaration of Domestic Assets Act, 2018 for undisclosed income and domestic assets and Foreign Assets (Declaration and Repatriation) Act, 2018 for undisclosed foreign assets now sand expired.

The FBR has so far collected Rs255 billion during first month of current fiscal year i.e. July 2018 against Rs211 billion in July 2017, reflecting an increase of Rs44 billion. The number of declarations has been increased from 55,225 to 70,000 till July 31, 2018. So far, Rs122 billion has been generated through the scheme.

Amnesty scheme for foreign assets used to apply to both liquid and immovable assets such as bank accounts, shares and mortgaged properties. Tax rates range from 2 to 5 percent, depending on the type of assets. Special tax rate of 2 percent is applicable to liquid assets which are repatriated into Pakistan. The amnesty scheme for domestic assets covers all types of assets and income, with tax rates of 2 percent and 5 percent. To protect declarants from any harassment, both schemes under Voluntary Declaration of Domestic Assets Act, 2018 and Foreign Assets (Declaration and Repatriation) Act, 2018 promulgated on April 08, 2018 which eventually was made part of Finance Act, 2018 to ensure complete confidentiality of declarant’s information. Moreover, such information cannot be used as evidence against declarants under any other law.

In June 2018, declarants have paid around Rs97 billion out of which around Rs36 billion were collected on foreign assets and 61 billion on domestic assets. In addition, $40 million were repatriated in the said period. In July, the FBR generated Rs21 billion from the scheme and tax authorities are expecting total tax collection under the scheme around Rs122 billion.

The original closing date for filing declarations under the amnesty scheme was June 30, 2018. It was extended till July 31, 2018 on account of representations from trade bodies, professional associations and general public due to short operational period after clearing legal and procedural challenges and problems faced by declarants in the payment of tax on foreign assets and repatriation of liquid assets.