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Govt decides to abolish FBR due to Rs 1000b green channel misuse

Govt decides to abolish FBR due to Rs 1000b green channel misuse

KARACHI: The federal government has devised an action plan to establish a new tax authority after abolishing Federal Board of Revenue (FBR) due to green channel mega scam of Rs 1000 billion. Mobiles, electronics, liquor, cigarettes, betel nuts, explosive chemicals, etc continue to pour into the country through green channel.

Chief Justice of Pakistan Mian Saqib Nisar had taken notice of a complaint filed against illegal clearances through green channel while the court associate sent the order copy to the Chairman NAB for necessary action. After this notice, DG Customs Intelligence admitted ‘merciless abuse’ of green channel by syndicates in connivance with customs staff. ‪FBR has also admitted that 10 million containers have been cleared in Green Channel without any examination. In fact, not even scanning of these containers is done by customs.

Customs Today exposed the green channel misuse by publishing hundreds of news since past many years. Mega brands like Mobilink and QMobile were reported to be grossly abusing Green Channel facility with connivance of Customs staff. Customs Today published several reports about betel nuts smuggling worth billions of rupees through ports at Port Qasim and Appraisement East Collectorate.

These reports led to multiple raids, tens of FIRs and recoveries of illegally cleared goods worth billions of rupees. In fact, in a single raid at a SITE area godown, 600,000kgs of betel nuts worth Rs 1.5 billion were seized. Customs Today also published investigative reports about changing of strategies by green channel smugglers as they started clearing illegal goods through yellow channel & TP.

Due to Rs 1000 billion green channel misuse, the federal government has devised an action plan to establish a new National Tax Authority (NTA) after abolishing Federal Board of Revenue (FBR). Chambers, trade bodies and importers across Pakistan appealed to and awaited comprehensive action from Member Customs Zahid Khokhar against green channel smugglers but he disappointed all of them. At last the government had to come into action and abolish the Federal Board of Revenue to stop green channel misuse and increase tax revenues.

The documents of action plan showed that the federal government has decided to bring reforms in tax system under which 10 per cent flat tax would be imposed on all sources of income and 2 per cent customs duty would be levied on all types of goods. The tax system would be made simpler and 20 per cent corporate tax and 8 per cent sales tax would be levied.

Moreover, withholding tax would be deducted after crossing the set limit of mobile, electricity and bank transactions. The withholding tax would be charged on mobile bills of Rs30,000/annum, commercial electricity bills of Rs36,000/annum, domestic electricity bills of Rs60,000/annum as well as bank transactions of Rs25,000 per annum.

According to the official documents, all the in/out-bound containers would be scanned and all causes of misuse of green channel and customs duty revenue losses would be abolished.

The government would also launch a merciless crackdown on smuggling, while tax laws, forms and return filing would be made easy. The government also aimed to collect data of non-filers who would be brought into tax net.