ICCI for implementation of equitable and fair taxation policy

  • March 12, 2011
Unfortunately taxation has not been given proper attention in Pakistan so it became an ineffective tool to form and influence socio-economic policies.

There should be a free and fair taxation policy in order to raise revenues, broadening and simplifying the tax base is the need of the day and the government needs to work on it, Mahfooz Elahi, President of Islamabad Chamber of Commerce & Industry (ICCI) has said, addressing the business community at ICCI.

He said that many people avoid filing tax returns because of their fear of harassment by tax department which were the main reasons for insufficient tax collection. Taxpayers yet felt insecure because of complications in the current taxation policy and lack of trust in the present tax system, he added.

ICCI President was of the view that the government should bring tax evaders into the tax net instead of milking the same cows.

He said that tax collectors should collect taxes and there should be no harassment. He anticipated that the country has a potential of increasing tax to GDP ratio by 3.5 per cent for next five years through making the system, public friendly and equitable. Widening tax net will allow reduction in tax rates, without reducing revenue, he said.

Elahi said that the encouragement of tax culture can only take place through removal of corruption from the tax departments, which will encourage and mobilize new taxpayers who are hesitant to contribute and continue to remain outside the tax net.

ICCI president said that once people see the tangible benefits of the taxes paid, there will be a better response to tax compliance. Hence it is imperative for the government to revamp the perceptions of public by proving that their money is spent on them.

He emphasized on winning the public confidence by improving governance, eradicating corruption and pursuing equitable tax policies were essential for revamping tax collection system, unless some concrete measures was taken on these lines, then the anxiety about not being able to pull the economy out of mounting debt and public expenditure will still linger.