ISLAMABAD: The Pakistan’s taxation system suffers serious structural problems manifested in a tax to GDP ratio that is the lowest in the region, it is learnt here.
Sources told Customs Today that multifarious ailments in the economy and systemic weaknesses are a few causes of poor revenue generation. The economy is largely non-documented where most economic transactions disappear without leaving a trace. Tax culture is non-existent and tax evasion and tax avoidance are not considered to be a stigma but is a societal norm.
Sources added that the FBR has made a plan for rationalization of concessionary regime and withdrawal of exemptions. Majority exemptions/ concessions have already been withdrawn in the Budget 2014-15 and 2015-16, while remaining will be withdrawn next year.
Sources added further that there were seven tariff slabs during 2013-14 which were reduced to six in 2014-15 and further reduced to five in 2015-16. Tariff peaks have also been reduced to 20 percent.
