LAHORE: Former governor of State Bank of Pakistan Dr Ishrat Husain said that administrative and policy reforms are need of the hour in tax system of the country as Federal Board of Revenue’s rules have become cumbersome and complex to understand.
Rate of sales tax and income tax are required to be brought down to collect more revenues. Trade with India is beneficial for Pakistan as it can bring prosperity in the country.
This was stated by former governor of State Bank of Pakistan Dr Ishrat Husain while talking to the economic journalists at the Lahore Chamber of Commerce and Industry here Thursday.
He said that tax system needed far-reaching reforms as Federal Board of Revenue’s rules were cumbersome and complex to understand. Even tax lawyers and commissioners were unable to comprehend these laws, he added.
“A large number of tax related cases are pending for years with the tax authorities including Tax Ombudsman but no one is there to entertain these cases,” DR Ishrat Husain pointed out.
He added that tax revenue can be increased by 50 percent by reducing rate of sales and income taxes.
He underscored that the FBR needs to bring in tax net more people who were living lavish lives instead squeezing the existing and documented taxpayers.
He pointed out that businessmen should be provided level playing field in order to increase exports and compete in the world.
“Our imports have increased and exports have decreased to 0.12 percent from 0.15 over time while in the region India and Bangladesh have increased their exports manifolds,” the former governor SBP held.
While talking on India Pakistan trade, he added that trade with India is beneficial for Pakistan as Pakistan would be able to get access to bigger market of India.
Further, he said that no country and nation can make progress unless it increases it rate of savings and Investment.
Pakistan’s savings and investment are ranging from 13to 14 percent while India and Bangladesh have increased their savings and investment to a significant level to attain economic growth and development, Dr Ishrat concluded.
