PM says top taxpayers ‘true VIPs of country’ | Pakistan Today

PM says top taxpayers ‘true VIPs of country’

–Prime Minister Imran says Pakistan will have to change itself, 1.7m income tax filers cannot bear burden of 210m population

–Says govt making efforts to develop tax-paying culture, ‘once system is fixed, country’s annual tax revenue will rise to Rs8 trillion’

–Asad Umar highlights need to go after ‘big fish’; Hammad Azhar says comprehensive reforms being undertaken to help enhance country’s revenue as per potential

ISLAMABAD: Prime Minister Imran Khan on Wednesday said the true VIPs of the country were the people who paid the most tax and such citizens should be facilitated and honoured.

Addressing a tax awards ceremony here, the premier stressed the need to change the mindset under which wealth creation was considered a sin so that people could be encouraged to invest in Pakistan.

For people who don’t pay their taxes, the premier said they should keep in mind that the country’s economic situation would worsen “if we don’t change our mindset” today.

“Like Darwin’s theory of ‘Survival of Species’ that calls for adaptability, Pakistan will have to change itself. Around 1.7 million income tax filers cannot bear the burden of a 210 million population,” he said.

As a result of this disparity, he added, the government was forced to impose indirect taxes on the common people who often cannot bear this burden. He said it was “unfair” that the prime minister was having to pay the same tax on things like petrol and diesel as a daily-wage labourer.

He noted that only 72,000 people from across the country declare an income of over Rs200,000, but added that it was “understandable” if people shied away from paying taxes because of their concern that their money would not be fully utilised for the uplift of the lower segments of society.

The premier regretted that Pakistan had not adopted the modern concepts from the state of Madina, the most important element of which he said was the collection of Zakat from the affluent which was then spent on the welfare of the masses.

“It is my mission to tax those people in Pakistan whose [luxurious] lifestyles do not match the amount of taxes they pay,” PM Imran said, stressing that he does not believe in raising the tax rate but prefers widening the tax net.

The premier said his government had adopted austerity measures itself first, with all ministeries directed to cut their expenditures by 10 per cent.

“I have reduced expenditures of Prime Minister House by 30pc … saving Rs150m so far,” he stated.

He regretted that while there were not enough medical facilities for the poor in the country on one hand, on the other, former prime minister Nawaz Sharif and his family members tended to go abroad for medical treatment.

“Taxpayers’ money is not for our personal indulgence,” the premier said, assuring the people that their money would be spent on their own welfare.

He said the government was making efforts to develop a tax-paying culture, including through reforms in the Federal Board of Revenue (FBR) and by moving towards e-governance to minimise the interaction between the tax collector and the taxpayer.

Once the system is fixed, the prime minister hoped that the country’s annual tax revenue would rise to Rs8 trillion from a current Rs4.5 trillion.

‘NEED TO CATCH BIG FISH’:

Speaking on the occasion, Minister for Finance Asad Umar said the tax that the government collects annually is simply not enough to run the affairs of the country and that other economies of a similar size collect more taxes than Pakistan.

He said the first measure in the drive to increase the tax-to-GDP ratio should be making it easy for people to pay taxes. Additionally, he said, the gathering of information by the FBR should be technology-based and people should only be asked the most essential questions.

The second step should be making it impossible for people who do not pay taxes to “find a place to hide”.

“There is no need to run after hundreds of thousands of people for this, [just] catch the big fish and the message will automatically reach down to the masses,” the minister advised the revenue authorities.

Thirdly, he said it was a right of the Pakistani taxpayer that their money is spent only on the welfare of the country. “That money cannot be used to build properties in London, or to store in banks of Switzerland, or to erect towers in Dubai.”

Minister of State for Revenue Hamad Azhar highlighted the measures taken by the incumbent government to reform the tax system over the last six months and said the separation of tax administration and tax policy in FBR was one of the major measures.

He referred to a report of the World Bank and said Pakistan stood at 175 out of 200 countries in terms of the most complicated tax systems, adding that it was losing Rs800 billion to Rs1,000 billion revenue due to flaws in the tax system.

Hamad, however, added that comprehensive reforms were being undertaken to help enhance the country’s revenue as per its potential.



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