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June 28, 2013

No new tax to be imposed for IMF bailout package: Dar

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Agencies
June 28, 2013

ISLAMABAD: Federal Finance Minister Ishaq Dar made it clear on Thursday that the government would neither make any compromise nor impose any new tax to avail itself of the IMF bailout package.
Responding to the points raised by the opposition members during their speeches on the Finance Bill, 2013 in the National Assembly, Ishaq Dar said the government had already rejected the IMF condition for imposition of more taxes. “Even if the IMF does not give us a loan, we will not impose new taxes but demonstrate that we can achieve the revenue collection targets,” he said.
Dar categorically told the House that the government would achieve the Rs2,475 billion revenue collection target by enhancing the tax net without imposing any new tax. “Programme or no programme with the IMF, we will not impose any new tax and have rejected would be in the interest of Pakistan and no condition against national interest would be acceptable.
“Tax collection target is a ‘tall order’, but we shall achieve it by increasing tax net and stopping tax theft,” he said, adding that the government had also increased the fine amount and imprisonment period for tax evaders.
He also clarified that the government had not introduced any mini-budget and said the proposals in the bill were not passed as it is because its final shape was created after inclusion of members’ recommendations as well as those coming from the Senate.He said at present the tax collection rate was even lesser than the inflation rate and this was the failure of the economic policies of the previous government.
The minister said the government honoured the SC decision on collection of GST from June 13. But this tax, he said, still collected from the consumers was not coming to the national kitty. He also rejected the notion that the increase of one percent had resulted in four to five percent additional tax collection.
Dar clarified that the perks and privileges of the NA speakers and the Senate

chairmen as well as the members were being adjusted to the same level as were before 2010 and 2012 respectively.
Dar said no new tax had been imposed on the pilgrims saying that it was introduced by the PPP government last year on operators. “We are increasing this from Rs2500 to Rs3500 and there will be no burden on the pilgrims,” he said. He asked the opposition not to do politics and stop playing to the gallery on the budget.
“The country is in a serious financial crisis; we need not play politics,” he said. He also clarified that a number of kitchen items were already exempted from tax to facilitate the poor in the country.
Ishaq Dar said in the budget proposal the rebate on income tax for educationists had been brought down from 75% to zero but on a proposal from opposition the rebate was taken to 40%.
Earlier, speaking on the Finance Bill, Syed Naveed Qamar said collection of GST by the government in the name of Excise Duty will embarrass provinces who will have to go for dual taxation.He said the government had introduced a mini-budget just within 20 days of the annual budget and feared more mini-budgets in the coming days.
Shah Mehmood Qureshi of Pakistan Tehrik-e-Insaf (PTI) said all the measures announced to achieve the revenue collection target of Rs2475 million were unrealistic. He said the government was not paying any heed to the proposal of the opposition members to provide relief to the masses.
Sheikh Rasheed Ahmed said salaries should be increased by 15% and the government should have burning issues on its agenda like the provision of electricity, water, gas and edibles at economical rates to relieve the poor.
Dr Azra Fazl Pecheho and Arif Hussain Alvi argued that the elite be taxed instead of the poor. “More people should benefited from the loan facility on housing, stop brain drain from the country and adopt a realistic policy on the power tariff increase.”
Dr Nafeesa Shah termed the budget jugglery of figures and ‘tyranny of taxes’ and talked about ‘advanced tax’ on various sectors. She said most of taxation will directly affect the poor and feared that such tax regime will result in leakages giving room to the underground economy will flourish. Moreover, measures proposed in Finance Bill will also affect the banking sector.
S A Iqbal Qadri opposed retrospective amendments for tax collection and defined it as ‘injustice to the poor people’.Amjad Khan Niazi said the budget was a jugglery of words and questioned different budgetary targets. He said budget had been prepared on the dictations of IMF, as indirect taxes were being imposed instead of direct taxes that will result in price hike.