Expand tax net instead of new taxes

LAHORE: There is no need to introduce new taxes for improvement in the economic system of Pakistan, rather the government should withdraw and remove the unnecessary incentives and unproductive facilities to various sectors to increase the resources.
These views were expressed by the experts in the Jang Economic Session on ‘Are new taxes required in budget 2015-16’. The panellists were former Chairman Federal Board of Revenue (FBR) Ansar Javeed, Javeed Qureshi, Anjum Nisar, Dr Yasir Mehmood, Imran Afzal and Naeem Mir while hosted by Sikandar Lodhi.
Ansar Javeed said that non-existence of tax culture was a tragedy for economy of Pakistan. Running the tax policy on ad hoc base has multiple problems while tax burden could be reduced by eliminating unnecessary incentives, he remarked. He called for creating balance in monetary policy which is actually guideline for tax policy while number of issues could be resolved by making policy keeping the ground realities in sight. He said equal distribution of resources was crucial which could easily be done through tax policy. He said FBR was not working in right direction and suggested making the system easy for tax payers to expand tax base.
Javeed Qureshi said that introduction of tax culture was crucial for which reforms were required for both taxpayers and collectors. He suggested exemption of GST for agriculture, and inclusion of every sector in tax net without any discrimination. Anjum Nisar said no steps were taken for the promotion of tax culture in Pakistan while government institutions were not ready to perform, and were holding the public responsible for it. He termed putting the burden of taxes on existing taxpayers by increasing withholding and sales tax injustice. He suggested focus on important sectors for investment which generate employment opportunities. He called for practical steps for promotion of tax culture.
Dr Yasir Mehmood said that expansion of tax base and discouraging tax evasion was crucial to increase revenue generation. He called for expanding the base of existing taxes to the exempted sector instead of introducing new taxes. He said capital market could play vital role in growth with easy documentation. He suggested the implementation of equal tax collection system in which no one was exempted, increase direct taxes, and reduce indirect taxes which would increase the tax to GDP ratio as well.
Imran Afzal said everyone was taxed in Pakistan due to indirect taxes, so there is no space to increase the tax burden. He said better results could be achieved by utilising the existing data base of income determination. So no new tax will be required, nor increase in tax rate and tax amnesty scheme. He said honest taxpayer was burdened in Pakistan while evaders were enjoying.
Naeem Mir said money whitening was the major issue for documenting the economy while amnesty schemes flopped in the past. He said retailers and traders were major contributors to taxes but harassed with strict government actions. He called for reducing pages of tax return forms and easing the return filing.