Tuesday, August 16, 2022

Miftah promises increase in taxation with ‘consultation’

Finance Minister Miftah Ismail on Saturday said the government was in the process of bringing “millions of shops into the tax net” as he vowed to expand the tax base further over the next few months through “consultations” with stakeholders.

The PML-N leader made these remarks on Twitter in response to a tweet wherein a user had called out the government for letting the retailers off the hook with a “small fixed tax” and going after salaried individuals instead to generate more revenue.

Musadaq sahib I can fight only so many battles. We are bringing in (gently) millions of shops into the tax net, I have brought jewellers into the net, and rest assured I will bring in all the professionals you mentioned in the net over the next few months. 1/2 https://t.co/4POwL92w2l
— Miftah Ismail (@MiftahIsmail) June 25, 2022

In response, Miftah said he had brought jewellers into the tax net and will bring designers, lawyers, and doctors into the tax net. He added that the government was also in talks to bring small shopkeepers and into the tax-paying category.

According to Miftah, he would bring real estate brokers, builders, housing society developers, car dealers, restaurants, salons etc into the tax net. “But nothing forced. With consultation,” Miftah said as he revealed the government’s approach to increasing the country’s tax base.

To bring small shopkeepers & jewellers into the net I talked to their associations & did so with their agreements. Now I will bring in real estate brokers, builders, housing society developers, car dealers, restaurants, salons etc in the net. But nothing forced. With consultation
— Miftah Ismail (@MiftahIsmail) June 25, 2022

A day earlier, PM Shehbaz Sharif announced a 10 per cent super tax on large-scale industries to boost revenue and provide relief to the lower economic segments. While announcing the increased tax rates, PM Shehbaz stated that the “rich would have to do their part” to alleviate the burden of inflation on the poorer segments of society.

READ: Finance Minister Miftah Ismail’s budget speech

The prime minister had stated that the revenue generated from the “super tax” would be beneficial for “poverty alleviation” in order to support the burden of inflation on the masses.

Sectors which will be subject to the tax include; steel, sugar, cement, oil, gas, fertilisers, LNG terminals, banking, textile, automobile, cigarettes, chemicals and beverages.

Shehbaz had further said that cross-subsidy would be used to strengthen public services in the education and the health sector and elaborated that such policies were necessary to reduce the country’s reliance on foreign loans.

“That is what we call economic freedom; that is what we call coming out of the shackles of slavery of borrowing money,” he had furthered.

The premier had also announced the imposition of another tax on those citizens who earn an annual income of Rs150 million or higher.

According to the prime minister, those earning Rs150 million will have their tax rate increased by 1%. Those earning Rs200 million will have their tax rate increased by 2%. Those individuals earning more than Rs250 million will have their tax rate increased by 3% and those earning more than Rs300 million will have their tax rate increased by 4%.

 

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