Pursuant to the 7th NFC award the Government of Sindh (GoS) decided to impose, assess and collect sales tax on services. Accordingly the Sindh Revenue Board Act, 2010 was promulgated on Tuesday, the 24th of June, 2010 vide Gazette Notification No: PAS/Legis-B-12/2010 having duly received the assent of Sindh Assembly. The Act provides for the creation of a Board to manage, supervise and take all such actions as are necessary towards the administration of sales tax on services. The Board will be headed by a Chairman assisted by not less than four Members each being the functional head of Operations, Legal Affairs & Coordination, Support Services and Audit, respectively.
The Sindh Revenue Board Act can be viewed here. The Board would be responsible for overall policies and general administration of the services, while the Commissionerates would be charged with the actual task of Registrations, De-registrations, Assessments and Collection of sales tax on services. A separate Appellate Forum has also been proposed i.e., the forum of Commissioner (Appeals) to address tax payers' grievances. A mechanism for Audit function has also been proposed to ensure the proper functioning of the Commissionerates.
Currently the Registered Persons (RPs) paying taxes on services to the FBR are doing so in a practically paperless system. Any regression in this regard would be detrimental to the initiation of and eventual success of this venture. It is therefore, proposed that the system should incorporate automated registration, e- filing of all tax returns and other statements including collection of revenue through automated bank transfers. It is, therefore, proposed that all Management Information System (MIS) be computerized and accordingly regular information furnished to outside agencies for example Accountant General Sindh (AG- Sindh), Department of Finance, GoS etc. be made through computers.
It is also proposed to create and maintain a comprehensive database of all RPs including their nature of business, taxes paid and other related information in order to generate timely and credible statistics for use in framing sustainable tax policies. Finally, it is proposed to have this system flexible enough to cater for changes in tax policies as well as absorb expansion to include other provincial taxes.
It is also proposed that SRB creates and maintains a comprehensive database of all RPs including their nature of business, taxes paid and other related information in order to generate timely and credible statistics for use in framing sustainable tax policies. Finally, it is proposed to have this system flexible enough to cater for changes in tax policies as well as absorb expansion to include other provincial taxes. The Board .may, where appropriate, issue notifications, orders, advices, circulars, rulings and instructions for the enforcement of any of the provisions of fiscal laws and the provision of Act.
The Board shall create and maintain a data bank containing infom1ation from third parties necessary to perform the objects and purposes of this Act. Such data shall be used for increasing the taxpayers'-base and to ensure accuracy of information submitted by existing taxpayers and for the financial analysis leading to proper economic assessments, audits, detection of tax evasion and policy decisions as may be necessary. The data shall be used further to evaluate the performance of the employees.
The 7th of June 2011 will go down as a historic day in the legislative history of the province of Sindh .This day the Provincial Assembly proclaimed and asserted its constitutional right to levy, assess, collect and generally administer Sales Tax on Services provided, rendered, initiated, received or consumed in the Province of Sindh. It is a moment of joy and celebration that the Province has embarked upon managing its own fiscal affairs instead of looking up to the federation for financial support.
The scope of activities has been enhanced further by adding Capital Value Tax and collection relating to Workers Welfare Fund and Employees Old Age Benefit Institution as provincially controlled laws as a result of devolution. The roadmap of future activities includes on the legal side, framing of all revenue related laws, rules and regulations and on the implementation side, recruitment of officers and staff, designing and implementing systems and developing and commissioning of modern automation and management information systems. It would also entail interaction with all stakeholders with a view to raising awareness, imparting training to officers/staff and overall capacity building.
In fact the Sindh Revenue Board is envisaged to be the primary resource for the provision of assistance and even monitoring the performance of all revenue departments in the province of Sindh. A project on rationalizing tax on agriculture is already in hand. Presently the Board is engaged in the process of recruitment of officers and staff who would work in the Board on permanent basis and great care is being taken to maintain transparency and merit so that the human resource inducted is the best available.