Traders call for setting FBR free from govt influence to enhance tax net

LAHORE: The All Pakistan Anjuman-e-Tajiran has called for making the FBR an independent institution, setting it free from any influence of the government and political victimization.

“When tax department has already been declared as an independent and autonomous institution under the Act 2007, then why government imposes decisions on it through Finance Division and Establishment Division, asked APAT Central general secretary Naeem Mir.

He said that government should devise some rules under the constitution to appoint the FBR chief on the patron of appointment of Election Commission Chairman. The tenure of FBR head should be fixed for at least four years with a view to continuation of policies and for this purpose necessary legislation should be made, he added.

He suggested the government to give the Board financial autonomy, allocating funds for it in federal budget every year, which could be spent on capacity building of its staff. Besides, he stressed the need for introducing reforms in the tax department, and purchase new equipment, besides implementing unique methods to enhance tax net.

He recommended the FBR to issue list of top 100 taxpayers every year and the companies should be bestowed with civil awards for paying highest tax to encourage them. He further asked the government to launch anti-smuggling force, which should be run directly under the FBR command.

He made it clear that without paying taxes no country can survive and government should impose income tax on agricultural income also. He said that business community has never asked for imposition of tax on poor farmers but tax should be equally levied.

He said that agriculture sector contributes over 23 per cent to the country’s Gross Domestic Production and yet accounts for less than 1 per cent of the government revenues.

He pointed out that the low share indicated that the entire value-added chain in the agriculture sector is nearly tax-exempted. With limited tax potential of many subsistence farmers, including 70 per cent MPs, the land revenue system needs to be replaced by agricultural income tax for any significant increase in revenues from this sector.

The gross profitability for agriculture products such as cotton, sugar and wheat have increased by 100, 63 and 52 per cent respectively during the last few years but tax collection from the sector remains minimal despite the fact that it continues to enjoy subsidized inputs and freedom to charge prices above international prices, he said.

“Since 2008, gross profit earned on all major crops has improved considerably but taxation on agriculture sector has always been negligible and the share of federal tax collection from agriculture sector has been only 0.12 percent of GDP in 2003-2004.