The Pakistan Economy Watch (PEW) on Sunday lauded the Finance Minister Ishaq Dar for rejecting the proposal of FBR to slap withholding tax on foreign remittances which could have a ravaging effect on the economy. FBR proposal to bring remittances in the tax net would have harassed the expats who send around 16 billion dollars to Pakistan annually keeping current account deficit under control, President PEW Dr Murtaza Mughal said.
He said that absence of remittances could jack up deficit from the current 1.5 billion dollars to 17 billion dollars which will push country to default therefore overseas Pakistanis should not be harassed. Exports are falling therefore policymakers should plan to encourage remittances which could be easily pushed up to 25 billion dollars through policy intervention.
Dr Murtaza Mughal said that masses and business community has lost faith in the tax system while efforts to access bank accounts has hit the credibility and deposits of banks and now it is after those patriotic people who work hard in foreign nations to send money home which keeps budget stable.
Expatriates sent fifteen billion dollars to Pakistan in the last ten months while exports remained nineteen billion dollars during the same period which should raise concerns, Dr Mughal said.
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