Pakistan Needs to Drop Tax Rates
May 21, 2016 Taxation in Pakistan
ISLAMABAD – Pakistan’s tax authority needs to try and foster more trust with taxpayers by dropping tax rates.
At a meeting of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on May 20th the President of the FPCCI Riaz Khattak called on the government to reduce the rates of sales tax and direct taxes.
Riaz Khattak claimed that currently only 3 percent of the population of Pakistan pay any sales tax, bringing in a total of approximately PKR 300 billion per year.
He added that if the rate of the tax was reduced by 7 percent on all goods and services, the total collected could even be tripled, rising to as much as PKR 900 billion.
The President of the FPCCI also claimed that the government should introduce flat rates of tax for all business sectors, a move which will help improve trust between taxpayers and tax authorities.
It is estimated that in 2006 Pakistan had approximately 1.6 million taxpayers, but now there is a approximately 1 million, a drop which, according to Riaz Khattak, occurred due to the ongoing distrust that taxpayers have of tax authorities.
Photo By: Pictures of Money