ByIslamabad, Pakistan: The Federal Board of Revenue (FBR) has held a meeting with leading business groups and tax compliant companies to discuss its transformation plan and measures to combat tax evasion.
The FBR Chairman, Rashid Mahmood, highlighted the need to address the chronic issue of non-filers and the Rs7.1 trillion tax gap. He emphasized the importance of reducing the burden on existing taxpayers and promoting a more equitable tax system. Business Recorder
The FBR presented its plans to:
Combat non-filers: The FBR will implement strict measures against non-filers, including restrictions on financial transactions, travel, and property ownership.
Expand the tax net: The FBR will focus on identifying and targeting individuals and businesses that are not paying their fair share of taxes.
Modernize the FBR: The FBR will invest in technology and digitization to improve efficiency and enhance tax collection.
Reduce the burden on compliant taxpayers: The FBR will explore ways to reduce the tax burden on existing taxpayers.
Combat smuggling: The FBR will establish special focal points to address smuggling activities, particularly in the textile and cement sectors.
The Federal Board of Revenue (FBR) reported a significant tax gap in 20 sectors, with the textile industry accounting for the largest portion at Rs700 billion. However, representatives from the textile industry disputed these figures.
While one participant suggested that proper implementation of existing legislation could address the tax gap, many businesspeople attributed the FBR’s reform plan to the government’s desire to reduce the cash economy and tax evasion.
It’s crucial to differentiate between compliant and non-compliant taxpayers. By providing benefits to compliant taxpayers and expanding the tax base, the government can potentially lower tax rates.
The FBR invited feedback from the business community on its proposed measures. Participants raised concerns about the impact of these measures on businesses and suggested that the FBR should focus on proper implementation of existing laws and regulations.
The FBR acknowledged the need for better communication and education to ensure that businesses and individuals understand the proposed changes and their implications. The FBR also committed to working with the business community to address their concerns and find mutually beneficial solutions.
