Prime Minister Imran Khan has approved the country’s first National Tariff Policy amid a flurry of activity to increase government revenue and encourage domestic productivity while maintaining transparency. The tariff policy aims to improve competitiveness, attract investment which creates jobs, and streamline the tariff structure. The policy aims to reduce exemptions and restructure tariff rates to aid domestic industry.
Meanwhile, the federal cabinet has also approved the sale of state land to pay off the ballooning government debt, which has gone past Rs27 trillion. The prime minister has directed the Privatisation Commission to set up an Asset Management Cell to sell real estate assets, according to reports. It will be for the first time since its creation about 30 years ago that the Privatisation Commission will sell real estate that is owned by the federal government ministries and departments at a large scale.
The commission had already written to government departments to share details of their vacant properties which led to the identification of more than 45,000 properties. But many of these are under disputed ownership. Also, given that it will take at least six months to sell any land and even longer for payment, the proposal is not a short term solution.
The move to sell state land is surprising, given that the government only recently removed at least 55 entities from the active list of privatisation, limiting it to only eight enterprises.
The third ‘new’ revenue generating avenue seems to be a renewed effort to catch major tax evaders. It has been decided to pick the top 100 cases from every Regional Tax Office and Large Taxpayers Unit, which will expand the final list to 2,400, according to FBR officials. These 2,400 people include politicians, celebrities, sportsmen, media persons, and real estate tycoons, according to the FBR.
The FBR has been under constant pressure from the prime minister after the PTI came into power last year. Despite this, the collection-revenue target gap continues to widen, and with the economy showing no signs of a serious resurgence, improving collection is going to be an uphill task.
Published in The Express Tribune, March 9th, 2019.
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