Speak­ers pro­pose flat tax­a­tion

Pakistan Observer - - ECONOMY WATCH - ISLAMABAD—Eco­nomic

ex­perts called for sim­pli­fy­ing tax­a­tion sys­tems and in­creas­ing rev­enues by low­er­ing the tax rate. Pol­icy Re­search In­sti­tute of Mar­ket Econ­omy (PRIME) held a sem­i­nar the other day ti­tled “To­wards flat tax­a­tion, the new par­a­digm”, un­veil­ing a break­through Study aimed to in­crease tax rev­enues by low­er­ing the tax rate, and sim­pli­fy­ing the tax code. The study is coau­thored by Huza­ima Bukhari and Dr. Ikra­mul­haq. Huza­ima Bukhari claimed that by sim­ply low­er­ing taxes and elim­i­nat­ing the com­plex­i­ties within the sys­tem, na­tional in­ter­nal rev­enues could be raised to Rs. 5 tril­lion an­nu­ally.

Her pro­pos­als in­cluded a 10 per­cent tax on in­di­vid­u­als, 20 per­cent on busi­nesses, 5 per­cent sin­gle stage sales tax, and a 5 per­cent sin­gle slab cus­toms duty. Her co-au­thor Dr Ikram said that Pak­ista­nis are a heav­ily taxed as a na­tion, pay­ing an 39 per­cent on ser­vices, and a 14 per­cent ad­justable in­come tax de- ducted at source. He re­vealed that 89 per­cent of the en­tire sales tax is col­lected through one hun­dred com­pa­nies. Pres­i­dent, In­sti­tute of Cost and Man­age­ment Ac­coun­tants (ICMA) Pak­istan Kashif Ma­teen en­dorsed the pro­pos­als on the grounds of jus­tice.

He said that com­plex­i­ties in the sys­tem cre­ate op­por­tu­nity for cor­rup­tion, and dis­cour­aged in­di­vid­u­als from com­pli­ance. He said that the FBR im­poses about 60 dif­fer­ent with­hold­ing taxes. Dr Shu­mail Daud, for­mer pres­i­dent Rawalpindi Cham­bers of Com­merce and In­dus­try (RCCI) put his weight be­hind the pro­pos­als, stat­ing that flat taxes are com­mon sense. He was pos­i­tive that a sim­pli­fied tax sys­tem would help raise rev­enues, broaden the tax base and en­cour­age vol­un­tary com­pli­ance. Ali Sal­man, Di­rec­tor of PRIME, lauded the au­thors for their de­tailed work, stat­ing that it would lay the foun­da­tions for a long over due, and much needed dis­cus­sion on Tax­payer rights, and fis­cally re­spon­si­ble gov­er­nance.—APP

KARACHI: Chair­man Na­tional Assem­bly Stand­ing Com­mit­tee on Com­merce Si­raj Muham­mad Khan pre­sid­ing over a meet­ing with the of­fi­cials of Trad­ing Cor­po­ra­tion of Pak­istan.

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