Complications and irritants in the present tax systems need to be made addressed for capitalising on the available tax potential in the country. Complexities in the taxation systems keep on increasing with every budgetary exercise, possibly due to reduced consultations with stakeholders by the Federal Board of Revenue (FBR), said Federation of Pakistan Chambers of Commerce and Industry (FPCCI) former vice president MA Jabbar.
Addressing a seminar on the present tax regime, he said that the business sector is substantially overburdened to resolve its tax issues rather than engage in economic activities on the basis of tax predictable business environment to contribute in improving socioeconomic conditions.
Also participating in the seminar, FPCCI Vice President Hanif Lakhani raised the question of meeting collection targets amid the shrinking growth, which has diverted the FBR’s focus from expanding the tax base to the existing registered persons.
Tax expert Dr Ikramul Haq said that he has designed a tax reform model that would bring a paradigm shift in the taxation structure of Pakistan. The model will align with incentives required to promote economic growth and induce compliance. He said that the rate of tax should be flat, lower with broad tax base. He further added that the taxpayers have to deal with multiple revenue and non-revenue agencies adding in developing non-encouraging environment for exploiting the available tax potential in the country.
Haq highlighted the issues and gave solutions in respect of complex income tax, distorted and multiple sales taxes, customs and SROs culture, multiple tax collection agencies and inefficient appellate system.
Published in The Express Tribune, March 16th, 2021.
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