• Wednesday, November 13, 2019

Shrinking ranks of taxpayers cause for concern

Discussion in 'Pakistan Economy' started by Leader, Dec 29, 2013.

  1. Leader

    Leader ELITE MEMBER

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    Shrinking ranks of taxpayers cause for concern

    The PML-N government’s talk of bringing the rich into the tax net has failed to produce any noticeable results as only 230 people have declared their gross income of over Rs100 million in a population of over 180m.

    What is particularly shocking is that the number of taxpayers who filed under the highest income bracket (gross income over Rs100m) this year has fallen drastically; over 11,000 people had filed in tax year 2012.

    The average tax paid in this category ranges between Rs22m up to a maximum of Rs77m.

    Overall, the total number of people who filed their tax returns in 2013 stood at over 800,000, as against 711,940 people in 2012.

    Dawn is in possession of the data submitted by taxpayers online with the Federal Board of Revenue (FBR) for tax year 2013. This data does not include those returns filed manually by taxpayers.

    According to this data only 160 people have declared their income between Rs50m to Rs100m, which also shows that the elite in this country are not paying their fair share of taxes.

    For the next tax bracket, the number of taxpayers who declared their income between Rs30m to Rs50m is 275, followed by 915 taxpayers who declared their income between Rs15m to Rs30m, respectively.

    The number reduces to a mere 2,000 when it comes to people who paid more than Rs2m to Rs3.6m as annual tax. And only 3,070 taxpayers paid up to Rs0.82m to Rs2m. Each of them contributed less than Rs2m to the government. This is less than the amount that one would need to purchase a 1,600cc car.

    Only 8,570 people paid tax in the range of Rs362,500 to Rs820,000, followed by 30,600 taxpayers who paid Rs95,000 to Rs362,500 as annual tax in 2013.

    With the fall in the incidence of gross income the number of taxpayers witnessed substantial increase. As many as 114,000 people declared their income in the range of Rs0.5m to Rs1.5m. In this category, people paid income tax from Rs10,000 to a maximum of Rs95,000 as annual tax.

    And 57,895 taxpayers have declared their income up to Rs0.5m. Each of them contributed from Rs1,000 to Rs4,000 as annual tax, with the second highest number of people who fall in this lowest slab.

    Those taxpayers who filed their returns in 2013 but declared nil income come to 74,000. This means that either these people have evaded paying tax or have concealed their income which could not be traced.

    Similarly, more than 2,000 people have declared losses in their tax returns.

    More than 3.3m taxpayers exist on the tax roll, but the filing of returns is just 24pc, showing poor compliance where filing is concerned.

    FBR official spokesman Shahid Husain Asad told Dawn that more than 505,000 people have filed manual returns with the regional tax offices. He said that only 292,370 people have e-filed tax returns.

    Most tax evaders are guilty of not completing the paperwork; tax is usually deducted at source when people are paid. But it is still mandatory for taxpayers to file their returns and wealth statements.

    People earning more than Rs500,000 a year may be punished for not filing the returns. The penalty starts from Rs5,000 and can go up to 25pc of the tax payable in a year. Tax officials can also force the guilty person to pay up the due tax.

    As per income tax law, filing of tax returns is mandatory for all those people who posses a 1,000cc car or a plot of 250 square yards or 2,000 square feet flat in any municipal corporation in the country.

    Imaginary taxpayers?

    What is particularly troubling is the fact that the ranks of taxpaying citizens seem to be shrinking every year. Statistics show that 1.44 million people filed their returns in 2011. Yet in 2012 there were only over 700,000 taxpayers in the country who the FBR could trace to their homes or workplaces.

    The filing of tax returns was reported at 1.7 million in tax year 2010. Does this mean that the missing numbers are imaginary taxpayers?

    Tax expert Dr Ikramul Haq attributed the poor compliance to the FBR’s inefficiency. He said it was a failure of the tax-collection body that it was unable to make all those with taxable income comply with filing returns.
    ln,
    Dr Haq said that three categories — lawyers, chambers of commerce and doctors were added to the list of mandatory tax return filers. As per law, he said there are more than one million lawyers and doctors who are supposed to file returns.

    He also observed that the numerical strength of the FBR did not enhance its performance.

    As a comparison, only 0.4pc of the population pays taxes in Pakistan, as against 4.7pc in India, 58pc in France and 80pc in Canada.



    Shrinking ranks of taxpayers cause for concern - DAWN.COM

    so these people probably paid for the election campaign of pmln, and now getting the favour back...
     
  2. Horus

    Horus ADMINISTRATOR

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    Who pays tax to a tax chor Prime minister of a tax chor parliament?
     
  3. Leader

    Leader ELITE MEMBER

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    apparently that be the deal. these billionaire would have supported pmln in elections. and now gettting the kick backs...otherwise how can the number fall from 11,000 tax payers to 238, earning more than 100 million bar ?

    @Jazzbot @A.Rafay @pkuser2k12
     
  4. pkuser2k12

    pkuser2k12 SENIOR MEMBER

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    PMLN needs public for one last thing that is the Local bodies elections


    The game is say yes to every thing they say else business community will do what they did in pp 72 Faisalabad


    Thats why in meeting with container owners they said yes to all there conditions,same with meeting with traders and same with textile associations


    and after local body elections pmln will go in full gear on its crush the public agenda
     
  5. Sugarcane

    Sugarcane ELITE MEMBER

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    What we need is reform in FBR and hang corrupt and haram khoor there - after all they are the one who have to assess the income and collect tax. In my openion
    1. Out source assessment of value (Assets & Imports) to 3rd party, preferably some reputed international firm as our people are corrupt to core, FBR should only collect.
    2. Include everyone in tax net - exception can be only in case if somewhere govt. want to attract investors by waving tax for limited time.
    3.. Make law that if it find assets being reported under value in tax return than govt. can buy those assets by paying 10% over than declared value.
    4. For Individuals - CNIC should be NTN no. and convert tax filing into necessity like national ID card by making it mandatory for purchase/sale of property and vehicles etc., obtaining legal documents i.e. passport, driving license, birth certificates for kids etc.
    5. Order bank accounts to automatically freeze bank accounts in case of non-filing of tax after passing last date.
    6. Gradually reduce indirect taxes and convert into direct taxes, so that everybody should have sense that it's his money and he should use his vote wisely to elect honest and competent people.
     
  6. AZADPAKISTAN2009

    AZADPAKISTAN2009 ELITE MEMBER

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    Solution for Pakistan (Special Case)

    1- Abolish Personal Income Tax (0% tax don't bother with pretending to file taxes)
    if only 200 people will follow it

    2- Put fixed 20% Taxes on Food, Water, Clothes , Utilities Electricity , Fuel , Gas Bus Ride, Train , Telecom, Hospital, Property Tax. 30% Tax on Shadi Hals or beauty products, collect this from people selling goods (Stores, Distributors or large vendors). Collect Tax on Roads *Toll Roads

    + Reduce the cost Flour (Roti) ,Dall (Pain Dal), Apples (1 Fruit) (No Tax)

    3- Agricultural Land Tax 1%

    4- Tax of $100 on Foreign Living Pakistanis per year in exchange for Right to vote
    in elections. If you paid this tax 4 out of 5 years you can vote in elections from
    overseas. (Should collect 200-300 Million Dollars from Overseas annually)

    5- Fixed taxation rate for Politicians (7 Lakh Rupees) per politician, CEO , CFO,
    Bank Directors , Judges , Doctors. If your occupation was these titles you pay
    fixed amount on top of Sales Tax. 5 Lakh out of 1 Carore is nothing for these
    Job Titles (800 USD Million should get collected easily). All these occupations
    make 1 Carore plus each year. If you are getting paid by Government of
    Pakistan you have to pay 7 Lakh Tax no questions asked


    6 - More then 2 Kids Tax (Add a Tax of 5000 Rupees/year) if you have Second
    Child or buy that 20 rupee condom your choice

    This should be starting point for next 2 years.

    + Keep Corporate Rate structure same


    7- Impose a small 1% tax on currency being sent out of Pakistan for property purchase in UAE or Dubai or UK etc.

    8 - Ban Motor Cycles , force people to use Train or Bus
    (Collect Tax on that Ticket)
     
    Last edited: Dec 29, 2013
  7. Counter-Errorist

    Counter-Errorist FULL MEMBER

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    Seriously?! Most of these will hurt the poor and benefit the rich.
     
  8. AZADPAKISTAN2009

    AZADPAKISTAN2009 ELITE MEMBER

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    NO PAIN NO GAIN

    A nation where people don't pay income tax only work around is impose tax every commodity they use.

    + Food (Tax it 20%) , and collect tax money from Distributors directly

    + Fuel (Tax it 20%), and collect it from Fuel Distribution authorities

    + Transportation (Tax it 20%) , and collect it from Metro , Train , Road Tolls
    don't wanna pay tax use bicycle.

    + Tax Utilities (Tax it 20%) , collect directly from Big Power companies.

    + Gas Utilities (Tax it 20%) , collect it directly from Big Power companies.

    + International Pakistanis wanting to vote deposit $100 , 4 straight years
    and you can vote next election. Or lump sum $400 deposit election year

    if you you live out of Pakistan. (Compensates for Missed taxes)

    + Doctors, CEO , CFO , CIO , DIRECTORS , High Executives , Judges, pay a lump
    sum 5 Lakh Tax on their income. (**FIXED AMOUNT***)
    These people earn , 50 Lakh plus salaries easily

    + Property Tax on Agricultural Land 1 %

    + Child Birth Tax (More then 1 Child you pay $5,000 rupees tax per year)
    penalty for having the second child. You choose , 20 rupee condom or pay tax.
    Nothing wrong in following sunnah as long as you can afford it

    + Ban Motor Cycles , bring in more buses in city. Motor cycle are cause of
    many accidents (Metro Projects) Government has to bring these.
    Or like in China people use "bicycle"

    + Toll Roads , charge money for traveling on Toll Roads. Exempt if you use
    Busses. Money goes to Traffic Police Benefit.

    + 30 % Tax on shadi halls, and beauti products. (Luxury Items)

    + Property Tax Exchange Tax (When you resale your property or buy new) your
    record is digitized and a copy of Tax is issued which you pay to government


    Benefits for Poor: Government Sponsors Subsidies for reducing prices

    Cheap Roti (Scheme) (NO TAX) (we are a agricultural country no brainer)
    Cheap Dall (Scheme) (NO TAX)
    Cheap Apple (Scheme) (NO TAX)

    PUT that tax on McDonalds, PEPSICO , COCACOLA , PIZZA HUT or the Hershey Chocolate bar, or Lays potatoe chip imported in

    Millions could be earned daily by just introducing the Toll Roads in Karachi , Lahore, Rawalpindi all large cities of Pakistan every one like to go for chill out time
    in nights eat some expensive dish in restaurants great ... well pay Toll service on road and then tax on the food you eat, before you claim to be poor


    **TAX political parties for Graffiti on city roads $1000 rupees for every slogan or
    poster on road which was failed to be removed after elections or campaign


    IMPOSE CAR TAX : FIXED AMOUNT 20,000 Rupees DO YOU NEED THAT LUXURY? Well pay for it
    Does not matter its you or your wife or your 10 year old son who the car is under you pay 20,000 Rupees or your 10 year old son , it should be paid annually to Government (Politcians , Public , Doctor , Judge , Military Head etc)

    Licensed Taxi Cabs exempt, private taxis they have to pay that fine

    > Benefits of Car Tax , old old old cars that are danger on road will be forced out
    > People will be forced to use buses and Taxi , less pollution on road.
    > Bicycles & Walking promotes health and reduces heart attack


    Pakistanis want to live lives of Rich and Famous yet they claim to be poor when it comes to paying taxes


    A poor would not car about that Car Tax , or a poor will not care about tax on McDonalds or Pizza ... a poor will not care about that income tax (for CEO , CFO or Judges or politicians)


    Some views of poor people of Pakistan
    [​IMG]

    Wonder how many people sitting in background pay taxes?
    [​IMG]

    This must be the car which is under the wives name
    [​IMG]

    Or this would be the poor ride little bilawal took to school every day

    [​IMG]

    Lot of poor Pakistanis will converge on this castle
    and they will each buy 1000 rupee burgers seems little bit luxury to me
    [​IMG]

    Either we can be poor or rich that pay taxes
     
    Last edited: Dec 30, 2013