The Federal Board of Revenue (FBR) needs to immediately correct the fractured system of taxation to meet the annual tax collection target of Rs. 7.47 trillion, according to a leading tax expert.
The report by leading tax expert Ashfaq Tola on the country’s economy released on Monday says that Pakistan needs to streamline its taxation system to attain the tax target of Rs. 7.47 trillion for the current fiscal year.
The report says that the ninth review of the International Monetary Fund’s (IMF) $7 billion loan programme has been stalled, and the date of this review is yet to be finalized. This delay is due to a lack of clarity on flood-related financial requirements for the ongoing fiscal year and a decrease in tax revenue collection in the wake of import controls.
It says that government should take measures to help the economy to stabilize and recover, and announce a strategic plan for sustainable economic growth and building foreign reserves instead of looking at friendly countries for bailout packages.
The report adds that effective policy measures such as limiting the size of the primary deficit in the budget, effective tax reforms to broaden the tax base, structural reforms in the commodity-producing sectors, comparative trade policies to enhance exports, reducing interest rates to boost economic activity, limiting the debt servicing and managing the external sector properly to avoid rampant devaluation of domestic currency are needed.