President Friends of Business and Economic Reforms (FEBR) Kashif Anwar has said the sustainable solution to Pakistan’s problems lies in the structural reforms, as we can see very large inefficiencies in tax collection, which needs to be removed. So, the tax compliance must be improved and tax base be broadened, which cannot be achieved with a single policy change, but by a systemic approach.
In a statement issued here on Sunday, he said that only direct taxes can improve tax collection, as the existing tax system is heavily skewed toward indirect taxation.
Kashif Anwar said the non-filers, who are outside the tax net, are not accounted for at all, which discourages businesses to come into the tax net, calling for legislations through parliament for protection of the rights of the existing taxpayers. Registered businesses are required to comply with various departments involving a lot of financial and time resources, whereas unregistered businesses are free from all such hassles, he maintained.
President FEBR said that in the past instead of focusing on controlling under-invoicing, curbing smuggling and expanding the tax net, the FBR seems to be inclined to pressurize registered taxpayers, who are already suffering due to a high rate of sales tax, income tax.