Tax system seen as a major threat to the country

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ISLAMABAD: The unfair and oppressive tax structure is the greatest threat the country faces, the Islamabad Women's Chamber of Commerce and Industry (IWCCI) said.

Our tax system is promoting inequality, which is damaging country's growth and blocking access of masses to economic opportunities, said Farida Rashid President IWCCI. Worsening inequality has reached to an extreme level due to reluctance of the government to impose tax on rich, unwillingness of authorities to bring exempted and influential into the tax net and limited redress opportunities available to honest taxpayers, she said.

The reforms have become imperative as complex tax system redistributes a small amount of money while doing little to slow the polarisation of wealth. Tax is imposed on rich to benefit poor but in our country it is other way around due to non-transparent postings in the Federal Board of Revenue (FBR) by the political class.

Powers to amend tax laws lies with the executive that has resulted in many problems including the infamous SRO culture, which is strangulating poor to please rich, she observed.

Proper taxation on agricultural income, real estate, brokers and retail sectors can resolve most of the problems country is facing if FBR is freed from political influence.

Why anyone should expect masses to pay taxes when rulers do not while over seventy percent of legislators have never bothered to file returns, she questioned.

Government's determination to introduce tax amnesty schemes despite disapproval by International Monetary Fund, coalition partners, opposition and experts means honest taxpayers are being provided incentive to become tax evaders, she said. How come authorities try to plug loopholes in the system to broaden tax net and support tax dodgers at the same time, she asked.

She said FBR took Rs 10 billion from World Bank to introduce reforms in the system, which resulted in reduced tax-to-GDP ratio by almost three percent. The practice of fixing unrealistic revenue collection targets and later revising it down has only helped others to laugh at us.

End.