A reasonable tax would be collected from wholesalers, retailers and traders in the near future, Khurram Schehzad said on Sunday as Pakistan takes steps to lower the burden on the salaried class by expanding the tax net.
“We had good meetings with retailers. You will hear new things and new taxes,” he said while appearing on the Aaj News programme Dus via video link.
“A reasonable tax will be collected from wholesalers, retailers, and traders so that everyone comes under the tax net to create an equitable economy. We have this plan.”
The International Monetary Fund and experts have urged the government to increase the number of taxpayers and lower the burden on the salaried class.
In September, the IMF’s Executive Board approved a new $7 billion, 37-month loan agreement for Pakistan that requires “sound policies and reforms” to strengthen macroeconomic stability. The approval released an immediate $1 billion disbursement to Islamabad.
The crisis-wracked South Asian country has had 22 previous IMF bailout programs since 1958.
When asked, Schehzad said: “We have identified three to four years and all four provinces have agreed to impose agriculture tax. Compliance and postmen are the next stage. It was giving less than one per cent being 23% part of the economy.”
He was of the view that the pace of inflation in Pakistan was better than in Egypt, Argentina, and Turkiye.
To a question about the increase in salaries of lawmakers, he said that it was a cabinet’s decision.
“My point of view is that if an MNA salary is at a level which is not sufficient and the kind of work is he doing… I think there is nothing wrong with reviewing it. We should see that there should be a competitive salary scale for everyone. If something is rationalized. Why someone would commit corruption if someone has a good salary.”
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The adviser to the finance minister added that the country would save Rs170 annually after ending irregularities in the pensions system. He admitted that it has to be “settled”.
While speaking about the right-sizing, Schehzad said that the government has aimed at saving $1 billion out of the $3 billion of the total cost of running civil government “as soon as possible.”
There are around 43 ministries and over 400 departments under the federal government, he said and added: “We have to lessen the federal government’s footprint.”
