PM urges traders to pay taxes

Prime Minister Imran Khan has urged traders to pay taxes as it is the only way to develop the country, saying if the government does not collect taxes, the entire nation would go down and everyone would suffer.

Speaking at a traders' convention on Monday, the Premier said that half of the tax collection is consumed in debt servicing. He asked traders to become partners of the government and termed the agreement between traders and government's economic team a welcome step.

He said the government first started its own belt-tightening and reduced expenditures by Rs 50 billion whereas the Armed Forces have frozen their budget for the first time.

The Prime Minister said he received great support from small traders during construction of cancer hospital, adding that traders were reluctant to pay tax because of lack of trust in the system as past rulers used the taxpayers' money on themselves like royals.

He said that it is important for a sovereign country to become self-sufficient in resources and not to seek money from others, regretting that half of the tax collection last year was consumed by the debt servicing as the country was indebted by previous governments.

Pakistan has gone up by 28 points in ease of doing business and the government's priority is to facilitate the business because increase in businesses is critical for creating new employment opportunities in the country.

He said that expenses of Prime Minister's Office have been reduced considerably. He said that he has been living in his own house. The government is trying to control inflation, he said. Earlier addressing to the convention, Adviser to Prime Minister on Finance Dr Abdul Hafeez Shaikh the basic objective of the government is to provide facilities to traders so that they can pay taxes and the government can meet its expenses without borrowing from other countries.

He said that the Prime Minister directed the government to remove difficulties being faced by traders. He said the government policy under the directives of the Prime Minister is to rely least on loans and increase trade. He stated that the government policies have started to bring improvement in things during the last few months with stock market going up and foreign exchange reserves are increasing. He said that government offices are open for traders to resolve their problems as these were opened during the discussions for reaching an agreement.

Speaking on the occasion, Chairman FBR Shabbar Zaidi said the traders' community is now moving towards a new destination after fulfillment of their demands and their subsequent documentation in response to concessions granted to them.

The number of traders in the country is very high but declared turnover of businesses is comparatively low. He said, "For the first time we are witnessing such a large gathering of traders having unanimous view for carrying out businesses in a dignified and conducive environment. All small traders want to live honorably. The traders were accused of tax evasion and it was also alleged that the traders' community does not pay taxes and does not want to come into the tax net, but they are committed to removing this stigma, claimed Zaidi.

The government has fulfilled demands of traders by granting them a number of concessions. The standard rate of minimum tax has been reduced from 1.5 to 0.5 percent and traders being individuals and having turnover of up to Rs 100 million shall not be required to act as a withholding agent.

After conclusion of the ceremony, the FBR's notified market committees in all major cities would start their work for registration of traders under the agreement between the FBR and the traders. The market committees were constituted within the jurisdiction of all Regional Tax Offices (RTOs) of the country.

The basic structure and design of the tax would be changed with the help of traders' community for documentation of the economy, he maintained.

The FBR chairman admitted that there are deficiencies in both the sides including traders and tax machinery.