While public representatives are divided over the imposition of income tax in Gilgit-Baltistan (G-B), the public has decried the move.
“It will be unfair to tax the people of G-B,” said Mirza Hussain, a Pakistan Muslim League (Q) member of the G-B Legislative Assembly, reasoning that a majority of the people are poor and cannot afford to pay taxes.
Hussain said that instead of imposing more taxes on the people of G-B, the federal should return the money it collected under various tax heads to help the area prosper. He urged that the public and the elected representatives of G-B to “stand against the decision”.
Nawaz Khan Naji, a nationalist leader and a member of the G-B assembly also rejected the move. He was of the view that federal government cannot impose tax on G-B unless it is given representation in the parliament. “No taxation without representation,” he said.
However, a member of the G-B Council, Amjad Hussain, had a contrasting view. He welcomed the move, saying that since the G-B government is short on funds, money gathered through income tax collections will help the government run its affairs smoothly. He confirmed that a notification to impose income tax in G-B has been issued to the departments concerned.
However, Hussain expressed reservations over the federal government taking the decision without making a written agreement with the G-B government.
“Without a written agreement, levying taxes would create complications for G-B as well as for the federal government,” he said.
As per the government’s notification, people whose annual income is above Rs400,000 and below Rs750,000 are liable to pay income tax at a rate of 10%. The tax percentage is 15% for people whose annual income is between Rs750,000 and Rs1.5 million, 20% for those whose annual income is between Rs1.5 million and Rs2.5 million, and 25% for those whose annual income is more than Rs2.5 million.
Officials of the G-B government said the decision to impose income tax was taken after holding consultations with members of the G-B Council. An official said the council members “agreed not to oppose the decision [to impose tax] in the larger interest of the region”.
Under the Governance Order 2009, the G-B Council is the only body with the authority to impose tax in G-B. The prime minister of Pakistan serves as the chairman of the council.
Published in The Express Tribune, October 31st, 2012.
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