Reform FBR (Federal Board of Revenue)
Imran Khan and his team from PTI (Pakistan Tehreek-e-Insaf) promised us:
PTI will reform FBR and increase the tax net through a robust tax policy, efficient tax administration structure and effective enforcement mechanism.
Pakistan’s current Tax to GDP ratio is significantly less than the ratio required to sustain our growing fiscal expenditure and to pay-off the massive national debt accumulated over the last decade. Further to which, our tax policies have consistently been suboptimal and as a result have led to:
Decrease in the tax net
Disproportionately higher share of indirect taxes (60%) in tax revenue, which adds to income inequality
High average tax rate of 31% for businesses and corporations
As part of FBR reform, we will:
Increase FBRs autonomy by reducing the influence of Ministry of Finance and will ensure FBR is performance managed.
Champion the shift towards direct taxation as the primary source of tax revenue as opposed to indirect taxes.
Incentivise businesses to become a part of the formal economy, thus adding larger sources of tax income to the national exchequer.
Champion sustainable initiatives to reduce taxes on businesses.
Simplify tax assessment rules for corporations and small businesses.
Integrate tax registration with associated processes to reduce the transaction cost of paying taxes.
Improve audits by establishing risk engines and smart algorithms to identify potential taxpayers for audit.
Improve enforcement through a robust standardised escalation process to ensure follow through of every non-payment.
Publish names of non-compliant debtors and strongly pursue large tax evaders.
Crack down on corrupt practices that promote tax evasion.
You can read these promises in the complete manifesto document released by PTI available HERE in English and HERE in Urdu.
Below will be / are the actions by Imran Khan and his Governance as a step towards fulfilling this promise: