LAHORE: Tax system should be simplified and tax rates should be reduced for everyone without any discrimination. Anybody who evades tax should be punished. Sales tax and income tax registration system needs complete overhauling. The government should also use Security and Exchange Commission of Pakistan to enhance tax net.
These views were expressed by Lahore Tax Bar Association senior member and former LTBA president Habibur Rehman Zubari while talking to Customs Today.
Registration of income and sales taxes are no less than herculean task, he said, adding that a few staff members are operating the system and some people’s registration is made in no time while others have to wait for months.
He said that the government should reduce sales tax rates and every sector should pay taxes instead of declaring zero rating tax sector and the filing of sales tax return system should also be made simple besides exemption to a few sectors should also go. To a question on increasing tax base, he answered that the Security and Exchange Commission of Pakistan should not accept form-‘A’ without unless the acknowledge of filing of income and sales tax return is not attached with the form.
He informed that above 1,25000 companies are registered with SECP of which only 7000 are filing their income tax returns which is an injustice to the state.
Cell phone data can also be helpful in increasing taxes, he said, adding that tax authorities should monitor the billing levels of the user and trace the users who are using telephone beyond a certain extent. Their phone should be disconnected unless they clear their tax liabilities.
He suggested that the government should direct SECP not to accept the Form ‘A’ and Form 20 if someone come without the evidence of last year’s income tax returns.
He further stated that the government should introduce incentive schemes for the regular and people who would get themselves as sales and income tax filers.
He was of the view that small traders should be issued fixed tax tickets and they would certainly incline to deposit their tax liabilities because most of the traders wanted to pay their tax liability but they fail because of complexities in the tax system.
To a query he said that deduction at income tax also required overhauling as currently the tax authorities are examining the accounts of seldom.
The accounts should be monitored and checked every month instead of five or ten years, he suggested, adding that that agriculture income should be brought under income tax.
