Islamabad Chamber of Commerce and Industry has lauded the announcement of Prime Minister Shahid Khaqan Abbasi that government intended to offer an amnesty scheme for foreign Pakistanis to enable them to declare their hidden foreign assets and bring back foreign exchange into the country.
However, they urged the government to offer separate amnesty schemes for local and foreign Pakistanis that would help broadening the tax base and improving the tax revenue of the country, said a press release here Saturday.
Sheikh Amir Waheed President, Muhammad Naveed Senior Vice President and Nisar Mirza Vice President, ICCI said Pakistan was facing the challenge of low tax revenue and low tax to GDP ratio.
However, many Pakistanis living within the country and outside were possessing significant hidden assets and money that could be brought into the mainstream economy by offering separate amnesty schemes.
They said offering such amnesty schemes at a time when Pakistan was facing decline in exports and rising trade as well as current account deficit would be a right move to bring more investment and money in the formal economy.
They said the tax amnesty scheme could also help in accelerating the economic growth through production and utilization of hidden liquid assets in the main stream of the economy.
They said it had become a common observation since last several years that the capital of Pakistani residents and non-residents was being invested in Middle East, Far Eastern countries, Western Europe and off shore Island in Southern Pacific and stressed that the main objective of the amnesty schemes should be to stop the flight of capital from Pakistan.
They said the high tax rates always promoted a culture of tax evasion and urged the government for focusing on reducing the tax rates and widening the tax base that would help in improving the tax revenue of the country.
They said the government should also introduce a fixed tax rate for the real estate sector to give boost to business activities in the property and construction sector.
They further urged the the government for working on a multipronged strategy to reform the country’s tax structure. The main focus of tax reforms measures should be to increase the tax base and to make the tax collection mechanism efficient and easier.