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ISLAMABAD: Federal Board of Revenue chairman Mumtaz Haider Rizvi said on Friday that no new taxes would be announced in the coming budget and rather a ‘newly-evolved’ comprehensive policy seeking reduction in tax rates on various commodities would be adopted to accelerate economic activities in the country.
“We will not levy new taxes in the next budget. We may only withdraw the exemptions available to special sectors through statuary regulatory orders (SROs),” he told Dawn, adding that loopholes in the tax machinery would be plugged. He said the budget would focus on measures aimed at attracting the foreign direct investment (FDI) and rationalise duty on various commodities to stimulate economic growth which would help absorb the jobless youth.
The FBR chairman was upbeat on the prospect of achieving the next year’s projected target of Rs2.3 trillion.
“It will be easy to collect the next year’s tax target because concrete and practical steps will be taken in the budget to generate additional revenue,” Mr Rizvi said. “I am optimistic to achieve this target because economic activities will also hopefully kick up next year.”
He said the new policy would focus on expanding the narrow tax base, instead of expanding the scope of taxation. He said lower rates would encourage people to come under the tax net voluntarily.
He was of the view that existing taxation system had become flawed with issuance of multiple SROs, schedules, multiple rates and slabs.
The chairman said he would strive hard to check the SRO culture.“We have identified the sectors enjoying specific duty exemption. We will apply these concessionary duty rates to all users through customs tariffs, instead of SROs to some specific taxpayers,” he said. “Reduction in the number of SROs will lead to reduction in corruption automatically in the tax machinery.”
Mr Rizvi said tax laws and procedures would be simplified, adding that the FBR was planning to withdraw income tax exemptions, phase out presumptive taxation regime and facilitate the salaried class.
