ICCI demands fixed tax regime for traders in next budget
Islamabad Sardar Yasir Ilyas Khan, President, Islamabad Chamber of Commerce & Industry has called upon the government to introduce a fixed tax regime for traders in the upcoming budget and end the condition of CNIC for them on sale that would help in promoting documented economy and increasing the tax revenue of the country. He said that the retail sector was making around 20 percent contribution to GDP and introducing a fixed tax regime for it would be a great initiative to broaden the tax base of the country besides making significant improvement in tax-to-GDP ratio. He said that the best option for the government to increase tax revenue is to avoid putting more tax burden on existing taxpayers and focus on broadening the tax base with low tax rates.
Sardar Yasir Ilyas Khan said that high tax rates in Pakistan were a major hurdle in promoting tax culture and bringing more people into the tax net as high tax rates always encouraged tax evasion. Therefore, the government should focus on rationalization of taxes to make them affordable for taxpayers that would be helpful in promoting tax compliance across the country. He said that tax on rental income was up to 37 percent in Pakistan due to which the business community was also facing great problems as they have to pay high rents of shops and this factor was giving rise to inflation as well. He stressed that the government in the coming budget should make a significant cut in tax on rental income in order to reduce cost of doing business and attract more local and foreign investment in the country.
Fatma Azim, Senior Vice President and Abdul Rehman Khan Vice President ICCI said that 17 percent GST in Pakistan was a major cause of high production cost and high inflation. They said that the GST was 5% in Canada, Taiwan & UAE, 7% in Singapore, 8% in Sri Lanka, 9% in Iran and 10% in Vietnam, which showed that the people and businesses in Pakistan were paying a very high GST. They urged that the government should bring down GST to single digit level in the coming budget that would be instrumental in reducing production cost and providing a great relief to the high inflation-stricken general public.