Sales tax may be in single digit in few years
Efforts are being made to bring down sales tax rate to single digit in the next few years and exempt annual income up to Rs350,000 from income tax, says Federal Board of Revenue (FBR) Member Inland Revenue Shahid Hussein Asad.
Speaking at a pre-budget seminar organised by the Lahore Tax Bar Association at the Regional Tax Office (RTO) here on Saturday, Asad said the upcoming budget would be people-friendly and instead of putting extra burden on existing taxpayers new taxpayers would be brought in the tax net. He claimed that instead of levying new taxes, the rate of existing taxes would be reduced.
He underscored the need for issuing national tax number in 72 hours, but sales tax number required verification and would take time.
He told bar members that most of their budget proposals had been approved as many were also forwarded by ICAP, chambers and other business organisations. FBR was serious about bringing the sales tax rate down to single digit in the next few years, he added.
Asad pointed out that Pakistan was passing through a critical juncture as out of expected total tax collection of Rs1,952 billion this year, Rs900 billion would be spent on debt servicing. This money “should have been spent on social welfare and support of common man.”
Published in The Express Tribune, April 22nd, 2012.
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Mr. Shahid Hussain Asad-FBR appreciate business like gesture, and this platform to listen and express common folks, which are the most likely beneficiary of the minimum taxable income. The indication about sales tax is also very encouraging, but this year is very important, if not this year than the years ahead will have different temperature and will be exposed to global warming. As we all know Pakistan follows IRS tax structure and certainly recieves guidelines from IRS, and also visit IRS for training, enforcement etc. Pakistan is the country blessed with the cheapest internet available, accessible to 99% population with the cost of mobile internet per month Rs.200-00. I have studied model of the EU member states allowing tax refund for VAT instantly online without any error. It is important that tax refund procedure and payments be adopted on scientific and best practices in the world with ICT technology. International collaboration to study models of on line payment, tax assessmements, refunds as and when necessary. By showing faith FBR has the right to penalise defaulters, evadors, and false claimants of refunds. Use of technology the ICT to which our country is in the fore front of high speed mobile internet 3G to use security measures for payment systems, with on line trading, yet prevent malafide practises.