Tax Amnesty Scheme to incur loss of around Rs 100 billion on the face of it: Report
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ISLAMABAD - The newly announced Tax Amnesty Scheme will cost Rs90 billion loss to the national kitty on the face of it.
The move under the ruling PML-N government’s economic package is likely to wipe out nearly 521,000 taxpayers from the tax net. The government has announced unprecedented relief in income tax rates to super rich people.
Internationally, according to a tax official, highest tax rates exist in the income tax law for those people who earn more.
But the most surprising move was to enhance exemption limit to Rs1.2 million from the existing Rs400,000 at a time when the government is nearing to complete its tenure on May 31, 2018 which economists consider a pre-election rigging move with no justification.
The internal analysis of the FBR shows that in case the government economic package was implemented in its current shape it will lead to further weakening of tax compliance. This means that half of the existing taxpayers will disappear automatically from the tax net, a senior tax official told Dawn.
The income tax system has already deteriorated owing to increasing reliance on withholding taxes. Most economists view withholding taxes in the current shape as indirect taxation in Pakistan, which hit the poor the most.
