sparklingway
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Pakistan has one of the world's lowest Tax to GDP ratios. It has stood between 9.5% and 10.4% since long and is extremely low compared to neighboring countries and similar economies.
The OECD average is around 36 percent with true welfare states like Norway and Sweden having Tax to GDP ratios as high as 43.6 and 49.7 percent respectively.
The only countries with a worse performance are:
Sierra Leone (10.5), Gabon (10.3), Mexico (9.7), Haiti (9.4), Bangladesh (8.5), Cambodia (8.0), Algeria (7.7), Central African Republic (7.7), Iran (7.3), Yemen (7.1), Afghanistan (6.4), Sudan (6.3), Nigeria (6.1), Congo (5.9), Angola 5.7, Saudi Arabia (5.3), Burma (4.9), Chad (4.2), Bahrain (2.4), Libya (2.7), Qatar (2.2), Oman (2.0), Equatorial Guinea (1.7), Kuwait (1.5) and UAE (1.4).
The miserable state of our ability to collect sales, income, property and wealth tax (let's say all forms of tax) has forced successive governments to increase indirect taxation in the forms of high GST, increased withholding tax and increasing the prices of basic utilities to increase revenue generation. Increases in tax collection are hardly keeping up with increased budgets and GDP. Over the last ten years, indirect taxation has increased on the average by 22.02 percent (FBR Yearbook '07-'08) thanks to near static income tax collection. Tax to GDP ratio of direct taxes stand at an abysmal 3.7 percent.
While the WB has been pushing forward some big measures with the FBR in the form of tax readjustment policies like the VAT, the biggest problem remains social as people do not feel it as their duty to pay taxes yet they demand services.
I'm hoping that you people can highlight why small business owners remain the biggest tax thiefs in this country and property tax remains as elusive as it is. I'm looking for more of a social answer rather than one based on readjustment policies.
In my honest opinion, people who do not pay taxes have no right to demand services (I'm saying "demand" services) and people who do not vote have no right to demand accountability or a change in policy.
The tax structure across OECD countries :-
PS:- India has been having the same problems as us and there are serious doubts over its ability to increase tax collection as dramatically as it needs to. And can anyone help me understand what is the correlation between such a low Tax to GDP ratio and oil producing countries.
The OECD average is around 36 percent with true welfare states like Norway and Sweden having Tax to GDP ratios as high as 43.6 and 49.7 percent respectively.
The only countries with a worse performance are:
Sierra Leone (10.5), Gabon (10.3), Mexico (9.7), Haiti (9.4), Bangladesh (8.5), Cambodia (8.0), Algeria (7.7), Central African Republic (7.7), Iran (7.3), Yemen (7.1), Afghanistan (6.4), Sudan (6.3), Nigeria (6.1), Congo (5.9), Angola 5.7, Saudi Arabia (5.3), Burma (4.9), Chad (4.2), Bahrain (2.4), Libya (2.7), Qatar (2.2), Oman (2.0), Equatorial Guinea (1.7), Kuwait (1.5) and UAE (1.4).
The miserable state of our ability to collect sales, income, property and wealth tax (let's say all forms of tax) has forced successive governments to increase indirect taxation in the forms of high GST, increased withholding tax and increasing the prices of basic utilities to increase revenue generation. Increases in tax collection are hardly keeping up with increased budgets and GDP. Over the last ten years, indirect taxation has increased on the average by 22.02 percent (FBR Yearbook '07-'08) thanks to near static income tax collection. Tax to GDP ratio of direct taxes stand at an abysmal 3.7 percent.
While the WB has been pushing forward some big measures with the FBR in the form of tax readjustment policies like the VAT, the biggest problem remains social as people do not feel it as their duty to pay taxes yet they demand services.
I'm hoping that you people can highlight why small business owners remain the biggest tax thiefs in this country and property tax remains as elusive as it is. I'm looking for more of a social answer rather than one based on readjustment policies.
In my honest opinion, people who do not pay taxes have no right to demand services (I'm saying "demand" services) and people who do not vote have no right to demand accountability or a change in policy.
The tax structure across OECD countries :-
PS:- India has been having the same problems as us and there are serious doubts over its ability to increase tax collection as dramatically as it needs to. And can anyone help me understand what is the correlation between such a low Tax to GDP ratio and oil producing countries.