Daily Times

ISLAMABAD: Economic experts at a pre-budget seminar urged the government to reform the tax culture and administration system, besides increase the spending on health and education budget up to 5 percent to GDP.

Former Advisor to Finance Minister Saqib Sherani while addressing the audience in pre-budget seminar organized by COMSATS University said that just 534,000 taxpayers are paying tax in Pakistan which is negating Finance Minister Ishaq Dar and Federal Board of Revenue authorities’ figures that believe the numbers of tax payer in Pakistan has reached to one million.

He said that Pakistan is ranked 172nd number on education and 187th on health to GDP spending around the world. Pakistan tax rate should be revised downwards to 25 percent.

He said that 650,000 doctors are working in Pakistan and only 14,000 are registered to FBR, same is the matter with lawyers out of 450,000 lawyers only 5,000 are paying tax. “Government should include these people into tax net so we can mitigate our deficit”, he asked the authorities. While referring a survey conducted by an NGO about the perception of general public how to increase the tax net of the country, he stated that 80 percent of general public will feel to motivate to pay the taxes if all parliamentarians to pay the taxes and 86 percent of the informal respondent feel that their tax money is wasted by the government. More than 72 percent people think that FBR is corrupt institution so upon these observations he said that it is need of hour that tax policy, tax administration and tax culture of the country should be reformed.

Dean of social science of NUST Dr Athar Masood Ahmad while talking on tax policy challenges in Pakistan said that FBR during last eight consecutive years since 2007-08 is missing its revenue target of 3104 billion rupee. FBR has some specific challenges that it is collecting 75 percent of revenue on 15 commodities, without POL taxes the FBR tax collection reduce to 70 percent of its current level further more FBR is collecting most of the tax through withholding tax. Professor of Economics at LUMS Dr Abid Burki in his point of view on improving business and climate change said Pakistan is having 35 percent highest tax rate that is above the regional and developed countries. Moreover, Pakistan has also the higher sale tax he said that if Pakistan wants more investment then it should have to combined sale and other tax rate. He further said that Pakistan tax system is 25 year out of date and it need complete overhauling to attract the foreign investment. Pakistan tax rate should be revised downwards to 25 percent.

While concluding the seminar, Chairman National Assembly Standing Committee Of Finance And Revenue, Qaisar Ahmad Sheikh said that Finance Minister should take into confidence the stakeholder during preparation of the budget. “As a committee chairman I do not know anything about budget” he said.