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Islamabad, July 13, 2012 (PPI-OT): Islamabad Chamber of Commerce and Industry (ICCI) has urged the newly appointed Chairman Federal Board of Revenue, Mr. Ali Arshad Hakeem to take measures for simplifying the complex and complicated taxation procedures, which will help in improving the tax revenue for the country.
Yassar Sakhi Butt, President ICCI made these remarks during a meeting at Chamber House. He said that the complicated tax procedures were creating troubles for the businessmen and FBR should facilitate taxpayers for making these procedures more simple and easy.
He said that businessmen were facing many challenges due to multiple factors like energy outage, rising inflation and deteriorating law and order situation. Therefore, they should be facilitated to expand businesses as revenue collection lies in the promotion and growth of business activities.
ICCI President was of the view that the solution to slow economic growth lies in the revival of progressive taxation policies and improved tax collection system. He urged the Government to broaden the tax net by bringing all the sectors into the tax net which were currently not being taxed and rendering a permanent revenue shortfall in the National Exchanger.
He said that country’s tax-to-GDP ratio had since long been declining and ultimately it registered around 10 percent of the GDP during last fiscal year. ICCI President added that developed countries have tax-to- GDP ratio from 30 to 40 percent, most of the developing economies from 15 to 25 percent like in India, this ratio stands at 15 percent and Bangladesh at 14.5 percent.
He urged the Chairman FBR to increase the tax-to-GDP ratio by overhauling the tax system and making the system justifiable and equitable.
Yassar Sakhi Butt said indirect taxes currently account for more than 60 percent of the total revenues while direct taxes to GDP ratio was merely 2 percent which has been badly affecting consumer spending that is a key driver of economic growth.
He said that proactive measures should be introduced to plug the leakages and loopholes in the prevailing tax system rather than adopting the policy of increasing the tax base through broadening the ratio of indirect taxes.
President ICCI underlined the need for revamping the taxation system of the country on the modern and progressive lines, which is essential for controlling inflation on a sustained basis.
For more information, contact:
Islamabad Chamber of Commerce and Industry
Chamber House, Aiwan-e-Sanat-o-Tijarat Road,
Mauve Area, G-8/1,
Islamabad, Pakistan
Tel: +9251 225 0526 and 225 3145
Fax: +9251 225 2950
Email: icci@brain.net.pk
Website: www.icci.com.pk