FBR withdrew five major income tax exemptions to generate additional revenue. DESIGN: FAIZAN DAWOOD
Educationists, social scientists and researchers have expressed concerns over the government’s decision to withdraw the 75 per cent tax exemption on salaries they were previously given.
The Federal Board of Revenue, in light of the new Finance Bill 2013-14, withdrew five major income tax exemptions to generate additional revenue. The withdrawals included a 75 percent tax exemption on salaries of professional teachers and researchers at accredited institutes.
The Pakistan Academy of Sciences executive secretary said that the step will seriously hamper scientific output in the country.
NUST Assistant Prof Dr Najma Sadiq said the tax break withdrawal will force teachers to rethink making the profession a full-time career.
HEC Chairperson Javaid Laghari said he spoke with Minister of State for Education Balighur Rehman and the minister had assured him that the issue will be addressed.
Conversely, Allama Iqbal Open University Prof Dr Noshad Khan said that he favoured the decision. “We cannot run this country without paying taxes and if we do not pay taxes, who else will contribute to the economy,” he said.
Published in The Express Tribune, June 17th, 2013.
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They wont spare anyone...
All those defending and justifying this brutal act with education in Pakistan. It is for you all; 1. There was no GST on lab equipment to be purchased for educational purposes, Government took that away. 2. Public Sector Universities are not industries, they do not make profits. However a tax has been imposed even on the savings of Endowment Funds of universities. How low can you get my dear government? 3. Army got a double rise in pays, what judiciary gets we all know. What Police gets that we also know and about bureaucrats do I need to mention? 4. University teachers got few facilities starting from 2002 on wards and the results are in front of you. 7 Public sector universities are in world top 400 today whereas it was no university in world top 500 prior to 2002. 5. Which other professionals have made it up to top rankings because of their performance despite huge facilities given to them? 6. The total financial impact of bringing universities under new taxation system is not more than o.13%. 7. Education is not a business but an investment in your future. 8. Current policies actually want to negate our poor country from reaping the results of the only good policy of Musharaf in education sector. New tax system encourages brain drain. It discourages public sector education and directly benefits private education mafias and cartels.. 9. Some of the teachers work purely because of motivation and commitment even at low salaries but such teachers who value money more because of their own circumstances are also not less. I have seen many PhDs leaving public sector universities and joining private sector universities as a result of such anti-public sector education policies. 10. Was education the only field left to generate some taxes out of it? I am sorry to say, we as a nation never learn from our mistakes and others' successes.
I paid from my own pocket to get my foreign degree. I worked overseas for 18 years. Upon returning back to Pakistan I preferred to join academia instead of Corporate sector, where I could have raked good money. But looking at the state of affairs of Education I choose to become a University Professor. I work more than eight hours at my job and also work at home in the evenings and weekends. We don't have summer vacations or off time. My teaching is practical oriented and research based. I have to be the best to stay in my job and it is more competitive than the corporate sector. I do all this with pride to serve my country. The only relief I got in all these years was that tax rebate. I have nothing against paying taxes. Most of us may not be aware that we are paying taxes on taxes on taxes. My only objection is that as a tax payer, we have the right to know where these taxes are going. Are they used to pay for the luxury cars or the foreign trips of our leaders and people sitting at top, or they are spent to benefit the common people. I feel bad when I pay taxes from my hard earned money and don't get the account for it. Lastly, you can't judge the depth of an ocean by sitting on the shores.You have to have the experience of teaching in a private University to judge the quality of work we do there. The times have changed now and so did the modern day hi-tech teaching. In America, teaching is known to be a prized profession, and due to the nature of the work involved they give all sorts of perks to the teachers and researchers. This profession is not for just anybody, but only for those few who can justify the needs. Those who are fit for this profession, can work hard, are dedicated and who can pare no sacrifice. May Allah SWT bless our Motherland, amen!
@Agha: Yes and give teachers the same pensions/retirement benefits and plots, staff cars and staff car monetization allowance and of course toll tax exemptions, recreational facilities (50% exemption on PIA, railway fares and joyrides), guest houses in Muree, Nathiagali, Kaghan and other tourist areas that armymen and bureaucrats are getting, and they will be more than willing to pay the 75% increase. At present University professors employed by HEC are not even offered a retirement pension, what to talk of plots/perks etc. If tax is to be across the board, why not perks and facilities? And mind you, half of the higher education professors are themselves Engineers and doctors.
I wonder if Finance Minister, cabinet and Mr. Nawaz Sharif ever studied in a governemnt owned Educational institutuion, and he knew anything about lives of low salaried teachers.
We are not talking about school here. Neither there is 3 month vacation not is there 9:00-2:00 job. Visit HEC website and read the tenure track rules, you will be surprised that even promotion is not linked solely to experience with outstanding appraisals.
You are only a decade away from how universities work.
Disapointing to see the reaction of academics. Why should they be exempted while other salaried are not. Same tax should be imposed on all income, and supposedly educated educators should know importance of tax to economy. For those who say that they don't get benefits, they get benefits like 8 to 2 job, 3 months vacation. That is a career choice they make. First people want govt to take hard decision, then when govt does, everyone starts complaining
Very Good and well deserved decision taken by the government to withdraw 75% tax exemption on salary of teachers and professors. tax collection is essential for every government and everyone must pay tax with no exemption whether he/she is teacher, doctor, Judge, banker of Uniform men. Teachers and professor are educated people and they are aware of tax importance they should welcome this decision like Prof Dr Noshad Khan (AIOU). If i am paying tax on my salary why not a teacher who is getting same salary not paying tax this is discriminatory law and against justice.
Everyone must pay tax with not exemption. If a Army man, Doctor, Engineer is paying tax why not teachers. Tax is always on salary not on Profession. Very good decision by PML (N) government. This is unfair and discriminatory law made by Musharraf to give 75% tax relief for teachers.
With policies such as these, this government is making it real easy for academicians that are deciding whether to emigrate or not emigrate. Clearly, this country is of feudals / politicians / armymen, for feudals / politicians / armymen and by feudals / politicians / armymen, and as far as I am concerned, after a little while longer, they are welcome to it!
Dr. Atta-ur-Rehman is the architect of current higher education policies that includes better salary packages and 75% tax exemption for faculty members of universities and research institutes. The main objective was to attract smart people in academia so that both education and research flourishes in Pakistan. The policies did work, today when you enter any good university, you find people who are highly educated and as good as their counterparts in industry.
While people in academia do NOT enjoy as many perks as their counterparts in government jobs and industry yet they do get a decent salary and 75% tax exemption that tries to compensates for the otherwise wide gap in the related perks & privileges. If the government is planning to withdraw this tax exemption then time is not very far when they will ax the Tenure Track and similar other Systems and take the higher education sector to the bad old days.
The citizens of Pakistan had high hopes from PML(N) that they will adopt education friendly policies and will significantly increase the education budget. On the contrary the are adopting policies that will discourage people from joining education sector and encourage them to leave it and join either industry or universities in middle east and in West.
I will urge the prime minister and the finance minister to withdraw this anti 'higher education & research' policy change from the budget. If that does not happen in the next few days then the university teachers association should give a call for peaceful protests all over the country.
This is another move to slaughter the already half-dead Education in our country. It will severely discourage, the already a minority of people, who choose Education to be their careers. Unlike other countries, Pakistan has no facilities for the teaching community, and it is not regarded even a respectable profession. On top of this they are withdrawing the only relief of this Tax rebate. Our future is nothing without Education, please consider reversing this decision, and also increasing more facilities for the teaching community, to make this job more attractive. Believe me, everything we do to promote and support Education will be paid-off ten folds in the future, and will strengthen our nation's foundations.
Many brave people will just faint at just the thought of raising this demand what you just said above Rumormonger. :) Our nation seems to believe in suppressing the suppressed ones only. Nobody dares to question those who are real looters and tax evaders. Awesome answer by you.
Indeed the country is in dire need of resources and permanent revenue sources. Every time whenever the government is confronted with the financial constraints the onus is on education and the health sectors. This is very unfortunate and unfair at the same time. The academic and researchers community have no extra benefits other than their salary package. Under certain planning the highly educated class of the Pakistani community is being kept in chaos since the creation of this motherland so that they could not play their determined role in the construction of their nation and keep engaged in part-time jobs for their bread and butter. If a teacher (Professor) and researcher of this country is provided the facilities of a Brigadier, with the sense accountability, the teachers of this country shall go to any extent in building this nation. An employee of WAPDA gets free electricity irrespective of number of units consumed in his accommodation. A teacher's kids cannot even get admission if somehow they missed the merit list by one number. I strongly recommend 100% tax exemption to the teachers.
"Allama Iqbal Open University Prof Dr Noshad Khan said that he favoured the decision. “We cannot run this country without paying taxes and if we do not pay taxes, who else will contribute to the economy" How about taxing the big landowners who hold hereditary rights to large stretches of agriculture land. Why should only the salaried people be taxed?