File photo of Finance Minister Saleem Mandviwalla. PHOTO: FILE
On a question about terminating the requirement of NTN while purchasing a car, the finance minister answered that this would not affect the tax collections negatively because people issue NTN while purchasing a new car and afterwards they destroy it.
He also said that the finance ministry was reviewing the flat rates of agricultural tube wells and if they were approved then the subsidies would be allocated promptly.
While talking about the new budget, he said that the federal budget of upcoming year 2013-14 will be prepared by the new elected government and not the caretaker government.
If the new national assembly and elected government came into before the elections, then they will prepare and present the budget.
Otherwise, the caretaker government will prepare the financial document and the interim cabinet will give it temporary ascent whilst its upholding and implementation would be subjected to the final approval of the elected parliament that will come into power after the upcoming federal elections.
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Going through all the comments, I feel that there an urgent need to eductate masses in Pakistan about tax system. In order to run a govt efficiently, it needs money for public welfare. This money is collected through taxes known as revenue generation. Taxes could be direct; corporate or individual income tax and indirect; VAT, Sales & service tax, import duty, excise duty, etc that is recovered by seller/manufacturer/service provider. The govt has planned and non planned expenses in the field of military, education, health, public works, roads, sewer, transport, railways, electricity, telecommunications, justice, subsidy in food, fertilizers, etc, interest repayment, etc. A detailed budget is made each year with revenue generation and expenses and the gap is filled with borrowings; internal or external.
The problem is hat neither people nor the govt is sincere about building the nation.
And what about Indirect Taxes Like Sales Tax, FEDs and Taxes on Fuel and Lubricants. Besides that Govrenment of Pakistan is fetching 29% taxes on Telecom services. meens more than 100 million Pakistanis are paying taxes indirectly.
I am one of them !
"because people issue NTN while purchasing a new car and afterwards they destroy it." What's the source of this statement, Mr. Minister?
@mahakaalchakra: you sould read riaz haq and bhook .com and get out of shining india syndrome
Only 900,000 people pay taxes: Mandviwalla that is why YOU MINISTER waived off condition of Having NTN # on purchasce of new car , a reward for NON NTN filer BRAVO Minister why crying over split milk.
@abdussamad: You are exaggerating it a bit too much. But the situation of tax collection is still not satisfactory in India. It needs to improve tremendously. There have been agitations against corruption. The same is required in Pakistan.
0.9 million out of 190 million pay tax! That is < 0.5% of the entire population!
@Ch. Allah Daad: Ch Saheb, there are basically two types of taxes, DIRECT TAX (Income Tax) & INDIRECT TAX (Sales tax, Excise or manufacturing tax, VAT, Octroi, Import duty, etc). You are talking of the second one.
@Xtreme: It is 8 times that of Pakistan. Yet the difference is the systems government has tried to put in place. It is absolutely essential deduct tax on salaries, contractual payments, rental payments, bank interest, etc and link them to PAN (NTN) no., on the database. If a person falls under the exempted category, he/she needs to fill a form declaring it. Any transaction above Rs 50,000 cannot be done through cash. Some time back the govt asked traders to pay a flat Rs 1600 per year and be free from worries of tax audit. Many followed and obtained PAN (NTN) thus coming in the tax database, It needs will and intention to implement a scheme, NIYAT chahiye huzoor.
@Xtreme:
Based on most recent figures, India's population is 1200 million.
You mean Pakistan has 120 Million Pakistani citizens and rest are either nonhuman or foreign terrorists?
My guess based on many articles is that Pakistan's population is around 200 million.
No point in raising more taxes, all will be doverted to defence and corruption. We should have zero income tax. All services should be taxed, all revenue targeted to education, health and defense (in that order).
@Yoghurt lover:
Who says "Could it be possible that most Pakistanis do not pay taxes, as they think it is unislamic?", wow was that supposed to be a joke?. Stick to your day job(if you have one) instead of trying for stand-up(or sit-down in your case) comedy.
@abdussamad: "@Gp65: Indian tax to GDP ratio is roughly double Pakistan’s."
You are correct of course. Also the composition of India's tax is much better than Pakistan i.e. 60% of India's tax is direct tax (corporate tax, income tax) and 40% in indiect tax (excise, customs, service tax, sales tax). In Pakistan, only 20% is direct tax and 80% is indirect tax.
The structure has reevance since direct tax is progressive and hence more egalitarian. Indirect tax is considered regressive.
So definitely India's tax system is performing much better than Pakistan. I just however wanted to point out that even so, there is no room for complacence since tax cheating is widespread in India as well.
Publish the directory of all tax payers especially those who own Prados, Pajero and luxury cars: both duty paid and non duty paid
@Gp65:
Yes. Correct.
This is shocking!
Meaning about 0.5% of Pakistanis pay taxes? How can Pakisatn survive?
@Xtreme: What rot. India's population is 6 times more at 1.2 billion and government is asking people to have only 2children but many Muslims, Christians and poor Hindus do not follow this edict.
@Gp65: Indian tax to GDP ratio is roughly double Pakistan's.
Also the Indian tax department is famous for conducting raids on suspected tax evaders at the drop of a hat :) I don't think you are considered truly successful in India until your house has been raided at least once.
Why File Annual Tax Return Every Year, Is There Direct Benefit to Annual Tax Return Filers? Pakistanis Subjected to Witholding Tax on Transactions, What Benefit is There for Annual Tax Return Filers? There is No Retirement Benefit in Terms of Monetary Consideration for Tax Return Filers. After Reaching Retirement Age the Tax Return Filers Do Not Receive Retirement Benefit so There is No REAL Incentive in Filing Annual Tax Return. What Common Sense is There in Filing Annual Tax Return?
I wanted to get an NTN. I followed all the procedures. When some clerk who was supposed to hand me the final print out asked me for a bribe, i gave up on the whole idea
@Raj786: India does have 40 million people with tax IDs not tax payers. The comparable number for Pakistan is 2"5 million.
In any case while Indian situation on taxes is definitely better than Pakistan, it too is not so good and lying about taxes and under payment is very common in India as well.
Only 42000 people admit to having an income of over 1 crore on their tax returns per Chidambarm.
Finally the statement should be qualified as paying income taxes. Because pretty much everyone has to pay sales tax and excise tax on goods we purchase.
@Xtreme: But the point is that they pay their taxes.
Can any one explain: If the new national assembly and elected government came into before the elections, then they will prepare and present the budget. Moreover, if you go through some loud claims made by our FBR Chairman, regarding the tax collection and action against tax evaders, where are these actions. It was all an effort to highlight himself in Media.
@Raj786: this is less than 4%, those pay tax in India. and in Pakistan , these less than half percent.
pay their taxes,??!! How can a responsible functionary pass such a "loose' statement? More than that how can a newsman/person report such a vague sweeping statement? CBR likely meant "income tax". All Citizens of Pakistan taxes. CBR just does not consider Those who buy petrol as taxpayers use electricity as taxpayers ( I suppose they think its Jazia to our rulers and arab sponsors aided and abeted by the Great Satan) As to the "considerations of flat rate for Agri". Note that farmers pay tax on power, diesel and their produce is taken away from them by the government for a pietance and then we also pay Jazia to our provincial govt. They call it Agri tax. We pay no income tax because we have no income.
@Xtreme: India's population is 7 times than Pakistan. The number of taxpayers is at least 40 times Pakistan.
@Xtreme: Actually the population is 1250/180 = 6.94 times more & the tax collection net is 40/0.9 = 44.44 times larger.
The reason is only people in Karachi pay taxes. 20 million are responsible for 50% of direct revenue collection whereas the remaining 160 million (including all of Punjab, KP & Baluchistan) are responsible for the remaining 50%!
Where are the rightwing self righteous urbanites from northern Punjab, who love to blog and think that they are the sole saviors of Pakistan. Where is their share of the income tax?
Its a biggest lie. Every Pakistani pay taxes but those are hidden taxes.
What? Previous quotes were 1,000,000. What happened to the 100K???
@Raj786
And population of India is about 10 times more than ours.
He did not mention how many of those are salaried persons who pay tax at source.
Since past 8 months we have been hearing that 0.9 million or so persons pay tax.So what has FBR done in last 6 months to increase the tax base.Nothing, just wasted time Mr Minister, the problem is FBR and Ministry of Finance is dysfunctional and they do not have moral courage to bring on books the tax evaders
In INDIA 40000000 indian pay tax
When the authorities know that only 0.9 million people pay taxes and rest of the people not, then whose fault is it?
Is Finance Minister Saleem Mandviwalla proud of those 0.9 million Pakistani citizens?