Government of PTI is going to announce the budget in coming months and with increasing dollar rates and increasing prices of commodities. Businessmen in Pakistan are worried about their incomes, profits, and taxes. Large amount what businessman earns goes to the taxes. And with increasing debt, the government has to increase the taxes to sustain their position. Mr. Zaidi, chairman of FBR, said that he has a clear plan to get more revenue for the government, but he will not put more burden on existing taxpayers.
Crackdown on Tax defaulters
In his conference, he said that there are a lot of people not paying taxes for their business and hiding in plain sight. He warned such people about the crackdown against them. He also warned people who are doing business on chit (parchi). A lot of shop keepers and cloth sellers do this kind of business in Pakistan. He said that these kinds off people are hurting Pakistan’s economy and putting more pressure on the existing taxpayers. As announced a crackdown against all these tax thieves. He did not elaborate in details of what actions he is going to take. Or what process FBR will be using to crack down these people. But in clear words, he said he was determined to bring these people in front.
Self-employed people are tax invaders
People like doctor, layers, jewelers, and freelancers who work and earn in cash are the ones who never pay taxes. Because there is no proper system to detect their earning activates, and that is why they need to catch. He said in clear words that
“I am quite serious about clamping down on professional service providers dealing in cash… We are very serious about bringing all those in tax net which deal in cash.”
Well, his statements make it clear that he is determined to bring them in the net of taxpayers. This will boost the tax income of the government a lot. And it might help the government to pay off some debts as well. Tax income is major source of government to run its processes, and that is why this step is very positive.
In the future, if he succeeded in bringing a system to capture these service providers who deal in cash, he will change Pakistan. Because the government will have sufficient funds to run its functions smoothly and it would not have to get loans. Also, there are other factors that can help the government to keep the economy on track. But nothing hurts the economy more than corruption and tax invasion.
Corruption decreases the government resources after they are collected from taxes and other sources. And tax invasion decreases the government’s income in the first place because corruption is done after the tax invasion. The first government needs to stop this tax invasion, and then it would be easy to stop corruption.