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Wednesday January 26, 2022

‘Revamping tax system may ensure inclusive economic growth’

November 28, 2021
‘Revamping tax system may ensure inclusive economic growth’

ISLAMABAD: Revamping tax system from regressive to progressive through changing culture at the Federal Board of Revenue (FBR), improving agricultural yields, raising investment for water conservation and ensuring policy support for Small Medium Enterprises (SMEs)-will lead to an inclusiveness in economy, said Shahiad Kardar, Vice Chancellor Beacon House University.

Delivering a key note address at the Sustainable Development Policy Institute (SDPI)’s symposium on ‘Inclusive Economic Growth, Risks, Challenges and Way Forward for Pakistan’s Economy,’ in Islamabad, he said the structure of economy has changed and the new emerging growth sectors are financial, IT, automobile and those which are capital and skills intensive. He called for eliminating export biases enabling participation in global supply chain and broaden the tax net base. He suggested that producers-driven commodity chain, buyers-driven approach and facilitation of services sector, and the enhanced role of private sector will be vital for inclusive economic growth. There is a need to take short-term initiatives to curtail imports by banning imports of some luxury items like cars and cellular phones, he added.

Shandana Gulzar Khan, MNA from PTI said, Pakistan was among those countries put under sovereign debt failure countries, where many countries didn’t survive, but Pakistan did due to appropriate policies, planning and resilience of the country. Now the investment is coming in venture funding in financial technology. A record level of funding of $85 million by June 2021 was received. The ventures are small and innovative and most of the youth are behind these ventures, she said. Executive Director, SDPI Dr. Abid Suleri said, one of the key risks to inclusive growth is “Omicron, the new variant of COVID 19 that is again shutting down various sectors.” The collective loss due to Covid-19 was huge, but Pakistan did comparatively well in terms of economic recovery. Energy prices are second big challenge to the international markets and Pakistan. “I don’t see inflation going down in the next six months, the government can improve the buying capacity of the people by creating employment opportunities and providing targeted subsidies. We can’t ignore our social sector developments, ignoring climate change will affect us negatively”, he said.

President Institute of Chartered Accountants of Pakistan, ICAP, Ashfaq Tola said, taxation is all about equity. In this part of the region, we look at taxation from different perspective. “Our primary focus is tax driven economy, this reverse direction leads us to nowhere.” Tracing the history of tax reforms in Pakistan, he said there is a need to take vibrant actions to expand the tax net by including agriculture, capital gains, services and informal sectors into it. He suggested eliminating all or most of the tax expenditure and tax holidays by moving away from presumptive taxes to more adequate and systematic taxation of personal and corporate nature. We need to invest in tax collection related IT equipment and software, he said.

Dr Sardar Mohazam, Managing Director National Energy Efficiency and Conservation Authority said there is a need to innovate access to energy which has different domains and may lead to inclusive economic growth. He said that renewable energy sources need to be promoted to increase access to various sources including solar and others. He said due to gap in supply and demand of energy, we have to manage it through load shedding. Renewable energy is making energy access possible thus making it more inclusive with focus on climate agenda. This agenda focuses on climate change mitigation part. Syed Javed Hassan, Chairman National Vocational and Technical Training Commission, said there is a need to replace old industrial approach to more incentivized approach to bring about sophistication in the country’s structural makeup.

We need to transform and make resources flexible to move from one activity to another economic activity. We need to overcome the limited scale of the domestic market by integrating it with regional and global markets. There is a need to invest in youth and women

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