SRB annual report

CM Shah said that during 2018-19 no new tax was imposed or enhanced just to provide a space to the businesses in tight economic conditions, and still the SRB was going to achieve its revenue collection target.

This he said while talking to Chairman SRB Khalid Mahmood, who presented him with the annual report of 2017-18. The report says that 2017-18 was significant in several respects, as the SRB met the target of Rs100 billion, posting an increase of 27 percent on a year-on-year basis. This included collections of Rs8 billion for the Sindh Workers Welfare Fund (WWF) and the Sindh Companies Profits (Workers Participation) Fund that the SRB had mandated to collect for the province.

The SRB chairman in his report says that the standard rate of the sales tax had been maintained at 13 percent during the year which is the lowest in any tax domain in the country, whether federal or provincial.

The collection effort has met challenges from the slow economic recovery, exacerbated by the impact of the political transition in the last quarter of the year. The Sindh government’s consistent support and taxpayers’ trust played an equally vital role in witnessing a growth of 27 percent.

According to the annual report, telecommunication, ports & operators, banks, insurance executions and franchise services remained major contributors. A sizeable growth was posted by other services, including business support and labor & manpower, and top 10 sectors contributed 57 percent of the collections compared with 63 percent last year, consistent effort was needed to tap the services hitherto escaping enforcement, and the renewed emphasis by national and sub-national tax domains on documented transactions is likely to ameliorate the task.

The CM said that the Sindh government took a policy decision to neither impose new taxes nor enhance the existing ones for the year 2018-19, providing a space to the businesses in tight economic conditions.

Apart from the envisaged good will of this decision, the target of Rs120 billion set for the year 2018-19 has become a daunting task given, in particular, the surmounting challenge of litigation.

Financial position

The CM presided over another meeting of the Sindh finance department to assess the financial position of the provincial government.

According to the finance department, as per the budget estimates the federal government has to transfer Rs605.3 billion during the current financial year. The 10-month estimates come to RsRs504.4 billion, but the Centre has transferred only Rs380 billion to the Sindh government. This shows a shortfall of Rs123.5 billion.

The chief minister decided to curtail non-development expenditures and axe releases to slow moving ongoing development schemes so that the schemes going on a fast track basis could be completed. He also directed the finance department to release the budget to the essential services.