Turkish, Korean models to be studied: Tax-to-GDP ratio
By Our Reporter
ISLAMABAD, Oct 21: The Central Board of Revenue (CBR) has decided to study the tax models of Turkey and Korea for achieving quantum jump in tax-to-GDP ratio. A senior official told Dawn that the decision was taken in a meting of Board-in-Council, which was chaired by CBR chairman M. Abdullah Yousuf, here on Friday.
The tax-to-GDP ratio has fallen to 9 per cent during the year 2004-05 from 9.4 per cent in the previous year, which is the lowest level recorded so far particularly in the sales tax and income tax.
The official said that it was initially identified that the two countries in the region had achieved double digit growth in their tax-to-GDP ratio during the last one decade, which would be taken as a case study.
According to the official, the meeting decided that the reform team would study extensively the tax policy measures taken by Turkey and Korea which resulted into increasing their tax-to-GDP ratio.
It was also decided that the World Bank and IMF would formally be requested to provide technical assistance for improving the tax ratio.
The statistics showed that share of agriculture in the GDP during the year 2004-05 was 20.2 per cent while its share in taxes stood at 1.2 per cent, transport, storage and communication 13.8 per cent (share in taxes 4.5 per cent), manufacturing 17.1 per cent (share in taxes 62.2 per cent), wholesales and retail trade 16.9 per cent (share in taxes 2.8 per cent).
