Notification on 22-member Tax Advisory Council issued
Billionaires to advise government on how to boost tax coffers.
According to the notification, the TAC will have mandate to discuss and recommend new tax proposals. CREATIVE COMMONS
ISLAMABAD:
The government on Wednesday issued a notification on the formation of the Tax Advisory Council (TAC) that is aimed at giving billionaires, who are direct beneficiaries of these policies, a formal role of advising on tax policy.
The 22-member large TAC would comprise of leading industrialists, chartered accountants, business community leaders, economists and former officers of the Federal Board of Revenue. These powerful businessmen deal in almost every main sector of the economy including dairy products, textile, steel, engineering, banking and trading.
The government has dropped the name of economist Ijaz Nab due to reservations expressed by Finance Minister Ishaq Dar.
According to the notification, the TAC will have mandate to discuss and recommend new tax proposals. It will provide input on different tax policy issues, enabling the government to adopt pluralistic views representing the divergent interest groups and, at the same time, enhance tax revenues, according to the notification.
It will deliberate upon and suggest measures for extending the tax net, propose legislation which would minimise opposition and increase compliance of the law, according to the notification.
However, the Council’s mandate put a question mark on the role of the tax machinery. The terms suggest that the government is interested in addressing concerns of business leaders in a bid to neutralise post-budget criticism.
According to the notification, in the category of industrialists, Syed Yawar Ali of Nestle Pakistan, Bashir Ali Muhammad of Gul Ahmad Textiles, S M Munir of Din Group of Industries and Mohsin Aziz, former chairman of All Pakistan Textile Mills Association, will be members of the TAC.
Ashfaq Tola, Chartered Account and senior partner at Naveed, Zafar, Ashfaq, Jaferry & Co and Asim Zulfiqar of Ferguson will be members from the category of chartered accounts. Tola is a renowned tax expert and was also a member of a body of similar nature, which was formed by the previous government.
The President of Federation of Pakistan Chambers of Commerce and Industries and his Lahore, Quetta, Karachi, Islamabad, Khyber-Pakthunkhwa counterparts along with chairman of the Pakistan Business Council are the other members. Secretary General of Overseas Investors Chambers of Commerce and Industry, advocates Abid Shahban and Akhtar Ali Naeem are also part of the TAC.
The government has also given representation to FBR’s former members, Irfan Nadeem Syed, Dar Manzoor Ahmad, Khalid Aziz Banth and Habib Fakharuddin. The two economists Dr Ali Cheema and Dr Qazi Masud are also on the Council.
The wide range representation has enlarged the committee’s size, reducing prospects of any meaningful discussions due to competing interests, according to the officials.
The idea to constitute a tax advisory body had originally been floated to simplify tax laws, plug loopholes and ensure principles of equity and fairness in the tax systems by seeking help of leading tax professionals of the country.
The tax machinery is heavily relying on presumptive tax regimes, as the FBR’s efforts have so far proven insufficient to tap the real income tax base. Similarly, the sales tax regime has also been plagued by granting tax exemptions to affluent people.
Published in The Express Tribune, March 13th, 2014.
The government on Wednesday issued a notification on the formation of the Tax Advisory Council (TAC) that is aimed at giving billionaires, who are direct beneficiaries of these policies, a formal role of advising on tax policy.
The 22-member large TAC would comprise of leading industrialists, chartered accountants, business community leaders, economists and former officers of the Federal Board of Revenue. These powerful businessmen deal in almost every main sector of the economy including dairy products, textile, steel, engineering, banking and trading.
The government has dropped the name of economist Ijaz Nab due to reservations expressed by Finance Minister Ishaq Dar.
According to the notification, the TAC will have mandate to discuss and recommend new tax proposals. It will provide input on different tax policy issues, enabling the government to adopt pluralistic views representing the divergent interest groups and, at the same time, enhance tax revenues, according to the notification.
It will deliberate upon and suggest measures for extending the tax net, propose legislation which would minimise opposition and increase compliance of the law, according to the notification.
However, the Council’s mandate put a question mark on the role of the tax machinery. The terms suggest that the government is interested in addressing concerns of business leaders in a bid to neutralise post-budget criticism.
According to the notification, in the category of industrialists, Syed Yawar Ali of Nestle Pakistan, Bashir Ali Muhammad of Gul Ahmad Textiles, S M Munir of Din Group of Industries and Mohsin Aziz, former chairman of All Pakistan Textile Mills Association, will be members of the TAC.
Ashfaq Tola, Chartered Account and senior partner at Naveed, Zafar, Ashfaq, Jaferry & Co and Asim Zulfiqar of Ferguson will be members from the category of chartered accounts. Tola is a renowned tax expert and was also a member of a body of similar nature, which was formed by the previous government.
The President of Federation of Pakistan Chambers of Commerce and Industries and his Lahore, Quetta, Karachi, Islamabad, Khyber-Pakthunkhwa counterparts along with chairman of the Pakistan Business Council are the other members. Secretary General of Overseas Investors Chambers of Commerce and Industry, advocates Abid Shahban and Akhtar Ali Naeem are also part of the TAC.
The government has also given representation to FBR’s former members, Irfan Nadeem Syed, Dar Manzoor Ahmad, Khalid Aziz Banth and Habib Fakharuddin. The two economists Dr Ali Cheema and Dr Qazi Masud are also on the Council.
The wide range representation has enlarged the committee’s size, reducing prospects of any meaningful discussions due to competing interests, according to the officials.
The idea to constitute a tax advisory body had originally been floated to simplify tax laws, plug loopholes and ensure principles of equity and fairness in the tax systems by seeking help of leading tax professionals of the country.
The tax machinery is heavily relying on presumptive tax regimes, as the FBR’s efforts have so far proven insufficient to tap the real income tax base. Similarly, the sales tax regime has also been plagued by granting tax exemptions to affluent people.
Published in The Express Tribune, March 13th, 2014.