ISLAMABAD: The Islamabad Chamber of Commerce and Industry (ICCI) has called upon the government to bring down high general sales tax rate to single digit level in the upcoming Federal Budget 2015-16 that will help in reducing inflation, boosting business activities and attracting more investment.
President Islamabad Chamber of Commerce and Industry Muzzamil Hussain Sabri said that 17 percent GST in Pakistan is very high as compared to many other countries. He said GST is just 5% in Taiwan, 6% in Malaysia, 7% in Iran & Singapore, 8% in Japan, 10% in Afghanistan & Indonesia and 12.36% in India while it is very high in Pakistan.
He said high GST for a developing country like Pakistan is not suitable and added that it is major hurdle in growth of business activities as it has caused price hike, squeezed the purchasing power of consumers and was a discouraging factor for attracting new investment. He said high GST also affected the margins of manufacturers as they have to share GST burden and was encouraging businesses towards the informal economy.
He said the single digit GST will create multiple benefits for the economy as it will create a conducive environment for growth of trade and industry, reduce inflation, enhance purchasing power of people, boost business activities and attract more investment in the country. He said low GST will also eliminate malpractices in refund claims and input tax leading to the reduced cost to the national exchequer. ICCI President further said the main advantage of reducing GST to single digit will give a big relief to the common man especially to the low and middle income groups.
He also stressed the need for making income tax return forms very simple and easy to understand for a common taxpayer. He said complicated tax forms were creating problems for most of the taxpayers and government should focus on simplifying these things and print tax forms in Urdu to facilitate the taxpayer, which will also help in generating more tax revenue for the country. He said government should make efforts to expand tax net instead of putting more burden on existing taxpayers. He said government should allocate more funds for health and education sectors and provide tax relief to IT sector as well.
