KARACHI: In the budget proposals released by the Association of Chartered Certified Accountants (ACCA), the body of professional accountants has urged the government, political parties to sign a “charter of economy” for the next 10-15 years to implement consistent policies and Pakistan must focus on lowering import bill, reducing non-essential imports and improving exports, shift the tax burden to the higher-income population and subsidise the cost of living for lower-income cadres and documentation of the economy and increasing FBR’s capacity can enable more tax collection.
Data Analytics and Artificial Intelligence, with rich-data sources like Nadra had enabled reduction of tax rates to a single digit, while broadening the tax net. Tax reforms can minimise harassment of taxpayer. Economic recovery is possible through encouragement of savings and incentives for local manufacturing and consumption of domestic products.
Large agricultural landowners should be taxed at minimal rates i.e. seven percent while also evolving the Roshan Digital Programme for overseas Pakistanis and improving the mining sector to attract FDI. Pakistan’s 5.8 percent unemployment rate can be reduced with social protection, while continuing the low-cost housing initiatives, along with liquidity for businesses.
The CPEC includes Special Economic Zones (SEZs) to stimulate the industrial sector. IT & ITeS is among the fastest growing sectors, contributing one percent of GDP, with potential of $ 15 to 20 billion exports by 2025. The government must invest in skills training, with focus on BPO. More transparency is needed to foster trust and cultivate a healthy tax culture, with simpler legislation to ease operational compliance. With efficient Tax-systems, the government can secure more revenues and prevent tax-leakage, while reducing the scale of black-economy in Pakistan.
Copyright Business Recorder, 2022