Rationalization of Taxes Essential for Broadening Tax Net: RCCI 

News Desk

Rawalpindi: The newly elected President of the Rawalpindi Chamber of Commerce and Industry (RCCI), Usman Shaukat, emphasized the need for tax rationalization to effectively broaden the tax net.

He expressed disappointment over the Federal Board of Revenue’s (FBR) inability to achieve the desired outcomes of the Tajir Dost Scheme, stating that it has failed to incorporate new taxpayers into the system and instead placed additional burdens on existing ones.

In a recent appearance on a private TV program, Shaukat highlighted that every year, additional taxes are imposed on current taxpayers, which does not contribute to expanding the tax base.

He reiterated the Chamber’s long-standing call for the tax authorities to increase the tax net by including new sectors and departments rather than relying solely on existing taxpayers.

Discussing the reasons behind the declining number of tax return filings, Shaukat pointed to a growing trust deficit between the business community and the FBR over the past few years. He identified this trust deficit as a significant factor contributing to the failure of the Tajir Dost Scheme.

Shaukat called for the elimination of loopholes in the Tajir Dost Scheme and stressed the importance of consulting stakeholders in the process. He criticized the current tax collection strategy, which bases assessments on the size of shops, deeming it unrealistic.

He concluded by addressing the imbalance in the tax system, noting that the rate of indirect taxes is excessively high while direct tax rates remain low.

Shaukat urged for a reformation of the tax system and the establishment of a rationalized tax policy that reflects the realities on the ground.