The Federal Board of Revenue (FBR) is reportedly resisting a proposal by the International Monetary Fund (IMF) to implement additional taxes of Rs. 176 billion on the salaried class in the upcoming budget, a national daily reported.
The news report quoted sources saying that various taxes are under consideration to boost the income tax collection from the current level of nearly Rs. 129 billion (by approximately Rs. 176 billion) to Rs. 305 billion.
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The IMF had proposed this to increase the revenue to create room for development expenditures and reduce the budget deficit. During the past fiscal year, the revenue collection from the salary income had increased to Rs. 129.4 billion from Rs. 76.4 billion in the preceding fiscal year. This was an increase of 70 percent.
However, the counter-proposal of the FBR suggests an increase of up to Rs. 10 billion in the tax collection from the salary income, opposing the higher increase due to soaring inflation.
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The news report revealed that Prime Minister Imran Khan also met with IMF officials and requested them to soften the conditions on the energy prices and taxes, and especially on education, health, and agriculture sectors.
The IMF has projected Pakistan’s revenue collection for the next fiscal year at Rs. 5.9 trillion, revised upwards from an initially expected collection of Rs. 4.6 trillion, an increase of 27 percent.
The best way to reduce budget deficit is by reducing corruption, dissolve non-performing organisations, reduce perks/privileges of MPAs/MNAs and improve over-all efficiency. But since it is very difficult task, the govt. ends up increasing taxes and prices of commodities.
No punishment for the criminal, burden is only for the honest people!