LAHORE: The Punjab Excise and Taxation Department seems to have succumbed to the pressure of influential owners of high-powered vehicles asithas Hfted the banonroutine transaction of these automobiles to `please the luxury tax defaulters` The ban was imposed on sale and purchase of more than 3,000 out of the 6,500 registered vehicles in Lahore with an engine capacity of 2000cc to 3000cc for not depositing luxury tax.

More than 15 parliamentarians ofthe ruling party in Punjab were also among the defaulters` list, a senior official privy to the information told Dawn.

He said the department had collected the special levy from the owners of the remaining 3,500 luxury vehicles under a scheme introduced by the Punjab government to bring the rich in the tax net. Most of these automobile were of prestigious brands like BMW, Inter-Cooler jeep, Mercedes, Range Rover etc.

The onetime luxury tax was imposed on the vehicles in two categories Rs200,000 on the vehicles having engine capacity between 2,000ccand 2,500cc and Rs300,000 for those of 3,000cc. The levy was in addition to other charges like registration fee, annual token fee, transfer of ownership rights etc.

Punjab E&T department Director General Naseem Sadiq, who is said to be behind the fresh move, has directed the officials concerned to stop receiving arrears from the defaulters till `further order`.

The step was taken as a result of constant pressure exerted by some of the owners of these luxury automobiles who also include parliamentarians, landlords, industrialists and politicians, the senior official said.He said some influential defaulters who were witnessed frequently visiting the office of the E&T DG during the last couple of weeks managed to convince him to meet the revenue target by allowing routine transactions like registration and token tax fee of the luxury vehicles.

On the other hand, he said, the department has calculated a minimum loss of Rs600 million under the luxury tax head that was to be paid by the defaulters of 3,000 vehicles.

The official said the Punjab government in the Finance Bill 2008 and later in 2010 had introduced luxury tax on the imported vehicles.

The E&T department launched a vigorous crackdown when the owners resisted the move.

However, many of them either took their vehicles to other cities, particularly Islamabad or `parked` them till some relief, like the lifting of ban, came to avoid the luxury tax.

In order to achieve the revenue target the department later included in the same scheme, through a notification, the luxury vehicles which were registered back in 2005 and 2007. The step aimed at generating more revenue by taxing the rich.

Resultantly, he said, the defaulters`list swelled to 3,000.

`We have completed record of 150 luxury vehicles which were stolen during the crackdown while of some 60 others was under process yet,` the official said.

The failure in meeting the revenue target under the luxury tax head has put a question mark on the department`s performance at a time when the Punjab government is preparing to present annual budget in June.

Mr Naseem Sadiq did not respond to the repeated calls and text messages by this reporter.

Motor Registration Authority Director Imran Aslam said the ban was lifted in order to collect revenue from the luxury vehicles against other services.

He said the revenue under the head of registration, annual token fee and transfer of ownership rights could not be received from the owners of these vehicles due to the ban imposed on them as a `punishment`.

The department reviewed the decision in order to encourage the defaulters who were earlier reluctant to bring their vehicles on roads to avoid the luxury tax.