There is no deadlock between traders and the Federal Board of Revenue over the fixed tax issues, said the board’s chairperson Shabbar Zaidi while addressing a press conference in Islamabad on Saturday.
We have had more than 40 meetings with groups of traders and all our discussions have been very positive, he said. “The government is steadfast in its belief that fixed tax should be imposed on small traders.” Even the traders have agreed that this should be the case but they said that tax should be determined by the turnover. We listened to their concerns but we have been engaging in dialogue on the way to determine the turnover.
Another tax reform that is being debated between the two parties is the CNIC condition. The government wants the traders to provide a copy of a purchaser’s CNIC for the sale of goods worth more than Rs50,000.
“I think that it is no longer an issue. We have all agreed to it,” he remarked.
Naeem Mir, a representative of the traders, said that they don’t have any problem with showing their CNIC at the time of the purchase. “We are scared of the consequences of this step,” he told SAMAA Digital. This will give government all the data about our sales and we can be easily blackmailed into paying a bribe to certain people. We will be stuck in the documentation and it will just lead to more corruption. “We don’t mind the condition, we just want assurity that our data will not be misused.”
On the fixed tax issue, he remarked that traders don’t have a fixed income. “How will they be able to pay a fixed tax?”
Hafeez Shaikh, the adviser to PM on finance, revenue, and economic affairs, said that the harsh steps taken by the government have improved the country’s economy. The situation of our foreign reserves is better now, he remarked.
The government tried to cut down its expenses. All cabinet members got a salary cut. The budget for the Pakistan Army was reduced. The PM cut down his own expenses. We tried to increase our revenue and brought 0.8 million people under the tax net. “We tried to increase exports and production so that people are able to benefit.”
He claimed that the government’s two big deficits have become less now. The trade deficit is down to $5.7 billion from $9 billion, while the fiscal deficit is down by 36% from Rs738billion in the first quarter to Rs476 billion.
“We did not borrow from the State Bank and didn’t approve any supplementary grant because we have been controlling our expenses,” he said. The big steps taken by the government have reaped positive results. Our exchange rate is stable now, Shaikh added.
Pakistan’s net portfolio network has increased to $340 million after three years. This shows that the international businessmen have shown confidence in Pakistan’s economy.
As for overseas employment, last year 240,000 Pakistanis went abroad but this year 333,000 people have gone. This will have a good impact on our economy, he added.
Agreement with Dubai
Dubai has disseminated information about all its properties owned by Pakistanis. They agreed to share the details during a meeting between members of the UAE finance ministry and the FBR, said Zaidi.
“Our stance was that iqama should be treated as a visit visa and they agreed that it should be considered as a residential permit.” Their law didn’t let them share information about iqama holders previously but we are working to change that, he added.
A delegation will visit Pakistan soon and our next session will be held in the coming months, Zaidi said.