September 17, 2006	Sunday	Sha'aban 23, 1427

KARACHI, Sept 16: Chairman Central Board of Revenue (CBR) Abdullah Yousuf has said that the government has to follow a tight monetary policy to keep inflation under check and to ensure that the macro economic indicators for achieving sustained growth during the current fiscal are not disturbed.

He urged the private sector to play its role in raising tax-to-GDP ratio. He was speaking at the launching ceremony of the new product of outsourcing of accounts management services by Ijara Financing Inc (IFI) on its 7th anniversary function here on late Friday evening.

He agreed that some challenges were being confronted by the economy but they could be overcome jointly by the government and the private sector with former providing an enabling environment and the latter working as an engine of growth.

The CBR chairman said that the high interest rates were being kept under tight monetary policy, which is required to keep inflation at 6.5 per cent and the growth rate at 7 per cent during FY 2006-07.

“The government is fully aware of these issues and challenges confronting the economy and hope to overcome these problems with the cooperation of the private sector,” he maintained.

He said that the CBR was committed to introduce such reforms, which could ensure a cut in cost of doing business in the country.

He said in the past there were protective markets with high tariffs but now the situation had totally changed and only those could survive who were competitive in the world market. Consequently, it was necessary that cost of doing business should also be reduced to ensure viability of industry and export competitiveness.

The chairman CBR urged upon the business community to play their due role in expanding tax-to-GDP ratio by reciprocating the government policy of voluntary compliance. “The time has come that past fears and apprehensions about tax collecting machinery should be forgotten and full confidence should be reposed,” he asserted.

If the government can repose trust upon trade and industry by adopting voluntary compliance under the Universal Self Assessment Scheme (USAS), there remain no question why the private sector should not enjoy full trust and shed away its past fears about the tax collectors, he added.

He said that the reform agenda being carried out in CBR with the World Bank’s assistance was a well-focused and a well thought-out plan to ensure an efficient and transparent service to the trade and industry.

This will also help to bring down cost of dong business, a key to the current free market challenges, which only allows those to survive who are cost-efficient in their products and services.

Referring to a point raised by S M Muneer, the CBR chairman said that presently only those issues were there, which have a historic link and no new cases and problems were cropping up owing to reforms and transparency being ensured in the working of the CBR.

He hoped that by the next year all these issues would be over and the CBR would start next fiscal with a clean slate.

Abdullah Yousuf said that the concept of outsourcing of accounts management services was taking root in many countries of the world but it was a new product in Pakistan.