KARACHI – Chairman of National Business Group Pakistan, President Pakistan Businessmen and Intellectuals Forum, and All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain on Wednesday said despite the best efforts of the government the direct tax compliance is not satisfactory which is imperative for the national development.
FBR has been given more powers but it has not deterred tax evaders which should be a cause of concern, he said.
Mian Zahid Hussain said that the government has tried its best to expand the tax base and improve collection but out of 7.2 million registered taxpayers only 2.5 million have submitted their returns for the year 2021.
Talking to the business community, the veteran business leader said that the attitude of the taxpayers has kept the direct income tax level at 35 percent of the total collection.
He noted that fines, arrest, jail, unilateral deduction from bank accounts and powers to disconnect electricity and phone connections of non-filers has not the improved situation.
He said that the tax-to-GDP ratio in Pakistan is a mere 10 percent and many governments have tried to boost it to 15 percent but never succeeded which is keeping the country backward and dependent on loans.
Mian Zahid Hussain further said that reduction in debt burden, cut in deficit, industrial development and improvement in social as well as economic indicators including the provision of jobs is linked to improved direct tax collection.
Reduced tax collection can compromise the integrity of a country, therefore, tax administration should be strengthened and direct taxation should be improved as indirect taxes hit the middle and poor class which force them to compromise on health and education which is very dangerous for the country.
He said that not a single country in the world has attained development through indirect taxation.
