years. Attaining that target means we will be in the business,” he said.
As Turkey has emerged as a success story in developing world by doubling tax to GDP ratio to 23.5 percent in almost 15 years through taxing goods/services and social-security contributions, it didn’t reach to this point overnight, the FBR officials argue.
“We had a detailed discussion with them and came to know that Turkey gained average increase of 0.5 percent annually. What it requires is the political stability and consistent policies,” said a leading tax administrator.
Asked why the FBR is hesitant to publicise the actions taken against the tax evaders, the official cited political reasons. He said the PML-N government is considered business friendly. Any effort to name and shame the big fish will tarnish its image as if it has launched a crackdown against the business class.
“The public at large may not know what we do, the reality has dawned on the potential tax evaders that they are on FBR’s radar,” he said.
If the steps taken by Finance Minister Ishaq Dar are any guide, the government appears serious as the decisions right from publishing the tax directory to the imposition of withholding tax on the banking transactions of the non-filers that has earned the ire of traders in particular.
The predictions were rife that the government will finally bow to the pressures of the traders. Zubair Motiwala, a Karachi-based business leader was vocal.
“I have seen how the government operates from inside and out for decades now, they are very scared of strikes and outcries of this sort. I’m telling you that this will be withdrawn,” he had told a newspaper.
However, the government resisted this pressure showing flexibility only to the point of cutting it to 0.3 percent from 0.6 percent until September 30, setting three-month deadline for the traders to file their tax returns. Although, splinter groups of the traders staged strikes even afterwards demanding its complete withdrawal, they failed to pressure the government into submission.