Azad Jammu and Kashmir (AJK) Prime Minister Raja Farooq Haider has directed the region’s tax authorities to broaden the tax net and modernise the tax collection system in order to enhance territory’s revenue receipts.
“Latest techniques should be employed in surveys to expand tax base and the department should innovate its collection system to make it easier for the existing and prospective taxpayers,” he said at meeting he chaired to review issues related to the AJK council as well as the performance and problems of the AJK Inland Revenue Department.
The meeting was attended by Minister for Law and Inland Revenue Sardar Farooq Ahmed Tahir, Minister for Health and Finance Dr Najeeb Naqi, chief secretary Shahzad Khan Bangash, additional chief secretary (general) Farhat Ali Mir, secretary finance Asmatullah Shah, secretary services Dr Liaquat Hussain Chaudhry and other officials concerned.
It may be recalled that the AJK Inland Revenue Department was under the administrative control of the AJK Council until June 2013 when it stood transferred to the AJK government after passage of 13thconstitutional amendment.
Earlier, the council would retain 20pc of income tax collected from the AJK territory for its “administrative expenditures” etc. and transfer the remaining 80pc to the AJK government in irregular installments, sometimes even after the end of the fiscal year.
This, according to the AJK government sources, would worsen their fiscal woes, forcing the government to obtain overdraft from the State Bank of Pakistan to make day-to-day expenditures and pay salaries.
The meeting was told that in 2017-18, the council had provided hardly Rs 10 billion to the AJK government [as its 80pc share] in income tax. However, after the AJK government took over the department, the income tax collection swelled to Rs 16.7 billion in 2018-19 and Rs 17.1billion in 2019-20.
In 2020-21, department expected to generate as much as Rs 20 billion from income tax, alone.
“This difference in income shows that around Rs 5 to 6 billion would be siphoned off from the income during the period when this department was administratively controlled by the council. We will try to dig out as to where this much amount would go,” the prime minister said.
He maintained that the 13th amendment in the AJK Constitution had restored AJK’s administrative and fiscal powers after 44 long years and subsequently vitalized its dealings and relations with Pakistan.
He appreciated that over the past four years his government had done away with the common practice of obtaining overdraft from the State Bank and had instead acquired financial autonomy.
“I have left no stone unturned in establishing clean and efficient administration and it’s because of our commitment that not a single [financial] scandal came to fore over the past four years.”
According to him, increase in income had ushered AJK in an era of development and progress, benefits of which were being reaped by the common man.
He also called for reduction in non-development expenditures so as to ensure savings to put share in AJK’s development activities, entire budget for which is currently provided by the federal government.
As the meeting was told that the AJK council secretariat [in Islamabad] had not yet provided tax inquiries and record of development projects to the AJK government, the prime minister directed the chief secretary to convene a meeting to settle this issue.
The meeting was also informed that only 25 employees in the AJK council secretariat were State Subject holders while the remaining 150 were non-Kashmiris who had however been given protection under the 13thamendment.
Tariq Naqash
