Print
Category: Taxation
Hits: 493

ISLAMABAD: Financial experts at a Public Hearing on Annual Budget 2016-17 on Wednesday stressed for an enhanced progressive taxation and reduction system over reliance on regressive and anti-poor withholding taxes.

The public hearing was organised by the Pakistan Institute of Parliamentary Affairs. Sustainable Development Policy Institute Deputy Executive Director Dr Vaqar Ahmed said, Specific measures for moving towards progressive taxation may include taxation of foreign incomes, capital tax on real estate and securities, reducing exemptions and concessions from direct tax. It is important to reform indirect taxes particularly the general sales tax regime.

Issues with the current GST regime includes complications of input invoicing, high cost of compliance and audit, and backlog of GST refunds, Dr Ahmed said, adding that due to high GST and other taxes on petroleum products, full benefit of low international oil prices was not transferred to the end consumers.

He said tax administration reforms were also important for bringing down the cost of doing business. It could be done by filing of joint return for both federal and provincial taxes levied on the same source of income; simplification of filing and documentation of GST; creating a special cell for expediting payment of refunds; and updating sales tax act 1990, which can incorporate all amendments that are to be retained, he added.

Finally, he said, it is important to note that in our ambition to raise revenues, we also tax welfare and non-profit organisations, adding that those organisations that are working towards non-profit motives with the view to help the poor communities should not face the burden of taxes.

Senator Saleem Mandviwalla said, Budgeting is not more than mere exercise in Pakistan. Such seminars should be organised frequently to increase public understanding on the topic, and to get their feedback. He called upon the students to participate in such seminars.

Senior Economist Kaiser Bengali, while talking about macro-economic conditions of the country, said that our social issues are piling up for last 30-35 years and all the past governments are responsible for it.

He said commodity-producing sectors are the legs of Pakistans economy, adding that growth in other sectors like manufacturing, without growth in commodity producing sectors, ie manufacturing and agriculture, is of no use.

From 2000 to 2015, there is only 2% growth in our major crops, which is less than the population growth. It would be no surprise if we will not be able to feed our people in coming years, he said, adding that there is no discussion on modernisation of growth.

Pakistans manufacturing rate remains single digit since 1991, which represents a stagnant economy, Bengali said, adding that it should be at least 10% for considering it a growing economy.

Ministry of Commerce Additional Secretary Robina Ather Ahmed said Pakistans share in global exports is diminishing by 1.45% every year since 2005. This is because our export is concentrated in terms of market and products. The EU, US, China and the UAE are four main markets on which our exporters concentrate. Our major exports are limited to textile, rice and a few other things, she added.