The Institute of Chartered Accountants of Pakistan (ICAP) on Tuesday called for the withdrawal of all income tax exemptions and asked the government to ensure the broadening of the tax base.
Speaking at the launching ceremony of Model Federal Budget 2022-23, ICAP President Ashfaq Yousuf Tola said that initiative of preparing proposals for federal and provincial budgets and presenting them to the Ministry of Finance was a professional exercise, adding that these proposals also aimed at having an understanding of the expectations of different segments of the economy from the next fiscal’s policy.
Tola highlighted that the country made a sound economic recovery from the COVID-19 induced contraction, however, it was still facing greater challenges that were creating huge external sector pressures. The trade deficit and current account deficit had already exceeded their annual targets, he said.
He said that in order to mitigate these challenges, the government needed to put in efforts for interest rate controls, and emphasize meeting tax collection targets.
The ICAP President said that some of the policy measures in this document were expected to bring in fruitful results for the economy by improving GDP and controlling the fiscal deficit.
Speaking on the occasion, Economic Advisory Committee Chairman Zeeshan Ijaz said that ICAP had submitted various proposals highlighting major areas of focus including investment in technology both in infrastructure as well as in terms of value addition.
He said that innovation, rationalization of subsidies, integration of Islamic banking and financial products in both private and federal dealings, and significance of regulation in power and construction sectors were also proposed in the model.
Fiscal Laws Committee Chairman Ali Latif said that ICAP has submitted detailed tax proposals to the Federal Board of Revenue (FBR) for consideration in the upcoming budget.
He said that during the discussion with FBR it was agreed that the focus should be to broaden the tax base along with ease of doing business instead of increasing the tax rates.
