Tax collection has increased significantly: ICCI
05 May 2013
ISLAMABAD – ICCI President Zafar Bakhtawari on Saturday said that tax collection had significantly increased from Rs 400 billion in year 2002 to around Rs 1,900 billion in the year 2012 but businessmen were still being accused of not paying their due taxes.
Bakhtawari stated this while addressing a pre-budget seminar organised by Association of Chartered Certified Accountants (ACCA) Pakistan in collaboration with Islamabad Chamber o f Commerce and Industry (ICCI) with an aim to contribute its efforts towards healthy fiscal measures in the country. He said that revenue collection has also increased due to encouragement of self assessment schemes introduced by FBR. He said that our budgetary expenditures were around Rs 3,000 billion and a huge amount of Rs 1,100 billion was taken for debt servicing which needs to be controlled in the upcoming budget for better fiscal management.
Bakhtawari suggested that the next fiscal budget should take emergency measures to deal with load shedding in the country. The budget should focus on providing alternate energy sources on emergency basis as Pakistan has huge coal reserves in Thar which could be exploited to overcome the energy crisis. He cited the example of India and China, who are producing more than 30percent of electricity from coal while Pakistan is not even producing one percent from this source.
The ICCI president further said that the public sector entities, including Pakistan Railways, WAPDA, PIA, Steel Mills and many other PSEs are incurring a loss of over Rs 600 billion annually. He said that enterprises should be immediately privatised or at least their 20 percent shares should be offered to the private sector to check massive losses.
He said that contribution of manufacturing, agriculture and services sector in the GDP were 26%, 20% and 54% respectively while their contribution in the tax collection is 66%, 1% and 33% respectively. Therefore, he emphasized to increase the contribution of agriculture sector in the tax collection as well as stressed to increase the tax base for significantly increasing the tax revenues.
Addressing the seminar, Aftab Ahmed, Chief Commissioner IR-RTO Federal Board of Revenue, said that there is a misconception that the reduction in the tax rates would improve revenue collection. He said that there is need to improve compliance and expand the tax base for increasing tax collection.
While boldly admitting deficiencies of the tax department and its limitations, he said that the tax policy must be driven by direct taxes but indirect taxes get more share in overall revenue collection and every citizen is contributing in indirect taxes in one way or the other. He categorically said that the frequent issuance of the SROs is not only damaging the tax machinery but also affecting tax system. There is an issue with the tax laws which can only be amended at the time of budget through Finance Act. Source Pakistan Today
Published: Zarai Media Team