PML-N gives new lease of life to tax exemptions

[Luftwaffe]

PML-N gives new lease of life to tax exemptions​

Another day another corruption...

ISLAMABAD: Like previous governments, the PML-N government has promoted the culture of tax exemptions and issued over 80 orders to reportedly benefit influential people in the first nine months (July to March) of the current financial year.

Soon after coming to power, the PML-N government had constituted a committee to review implications of the statutory regulatory orders (SROs) issued by the previous governments.

A study carried out by the government has revealed that yearly tax exemptions amount to Rs478 billion — nearly two per cent of the gross domestic product.

Several meetings chaired by finance minister have been held to review the study and identify concessions and exemptions which could be rationalised, simplified and minimised in or removed from the budget for 2014-15. But an official source said that influential lobbies were not ready to pay taxes and insisted on availing the exemptions.

The present government has so far issued eight SROs for customs duty exemption. A customs official said the revenue loss caused by incentives given to motorcycle manufacturers was yet to be calculated.

The government has issued 24 SROs for granting income tax exemption. Seven of them directly involve tax exemption of millions. The government has extended some of the income tax exemptions through SRO669(I)/2013 (amendment in second schedule of income tax); SRO739(I)/2013, SRO772(I)/2013, SRO799(I)/2013 and SRO828(I)/2013 (Different tax returns); SRO900(I)2013 (rate of income tax reduced for goods transport); SRO904(I)/2013 (rules for collection of income support levy); SRO978(I)/2013 (exemption from filing of wealth statement; SRO980(I)/2013 (rate of tax for passenger transport vehicles); SRO1040(I)/2013 (immunity from audit for tax year 2013); SRO1035(I)/2013 (rules for banking companies reporting); SRO1065(I)2013 (incentives for industrial undertaking); SRO1064(I)/2013 (rate of duty reduced for goods transport) and SRO17(I)/2014 (partial exemption on fee paid to educational institutions).

It issued SROs to grant one per cent further sales tax exemption. These are (SRO648 (I)/2013, change of mode of collection to production capacity basis from aerated water (SRO649 (I) 2013); reducing of sales tax from 17 percent to 5 percent on finished products of textile and leather products (SRO682 (I) 2013); reduction of tax rates on touch mobile phones (SRO740(I)/2013); and sales tax rate reduced from 17 pc to 1 pc in cases of purchases made from unregistered persons (SRO897(I) 2013).

SRO1072 was issued to charge federal excise duty at the rate of 0.5pc as against the applicable rate of 8pc on local sale of sugar to benefit a handful of political families which owned sugar mills. The concession is in addition to Rs12bn-Rs20bn sales tax exemption.

Preferential trade agreements signed with other countries in the recent past also caused huge revenue losses because they were not properly negotiated to safeguard the country’s interests.

According to an official of the customs department, just one SRO issued for the implementation of a preferential trade agreement with Indonesia is likely to cause a loss of Rs3.5bn to the exchequer.

Customs duty exemptions were granted through SRO687(I)/2013 (procedural changes); SRO742(I)2013 (regulatory duty imposed on sport utility vehicles); SRO939(I)/2013 and SRO940(I)/2013 (reduced customs duty for new entrants in motorcycles manufacturing industry); SRO1 073(I)/2013 (amendment in existing Safta).

 

[Dubious]

WTH?! Is he paving his way for retirrement? Lets pave it for the grave! Asshole kahin k!

exemption from filing of wealth statement;

immunity from audit for tax year 2013

Who the hell does such thing?

 

[Luftwaffe]

WTH?! Is he paving his way for retirrement? Lets pave it for the grave! Asshole kahin k!

Who the hell does such thing?

Corrupt lot like noon league & zardari over the top anp and mqm. These bast*rds will ruin remaining economy of Pakistan very soon. This is what happens when few people with-in establishment tries to rectify by bringing in same shyt to rule again for few top brass personal interests.

I would like to ask cb4 and tameen and rest of noon worshippers to answer what is economic gain in tax exemption to these elite class.

 

[Dubious]

Corrupt lot like noon league & zardari over the top anp and mqm. These bast*rds will ruin remaining economy of Pakistan very soon. This is what happens when few people with-in establishment tries to rectify by bringing in same shyt to rule again for few top brass personal interests.

I would like to ask cb4 and tameen and rest of noon worshippers to answer what is economic gain in tax exemption to these elite class.

Exactly? Why exempt those who can afford it? What logic is that? Lootayra logic!

 

[Luftwaffe]

Exactly? Why exempt those who can afford it? What logic is that? Lootayra logic!

From 1970 up till 2009 almost 280 billion rupees have been written off by SBP/local banks on behalf and forced by governments. I've never heard in west if you can't pay % of loans/debts as a business you beg or with political links write-off loans/debts but the banks adjusts % loan returns for the ease of company/organization/business. Lanat ho in logon par.

 

[Dubious]

From 1970 up till 2009 almost 280 billion rupees have been written off by SBP/local banks on behalf and forced by governments. I've never heard in west if you can't pay % of loans/debts as a business you beg or with political links write-off loans/debts but the banks adjusts % loan returns for the ease of company/organization/business. Lanat ho in logon par.

Didnt they learn from Greece?

 

[Chak Bamu]

Ahem. A reality check is called for here.

Not every exemption is corruption. It is easy to be pessimistic. But one ought to be accurate.

SROs are issued upon applications made by ordinary business people too. For example elecricity bills routinely include sales tax that used to be refunded upon application. But this route meant long wait and having to bribe low level officials to speed up refunds. Many manufacturers applied for exemptions from sales tax in electricity bills. Successful applicants (as a matter of course there were many) had SROs issued, exempting them from this nuisance. This happened during Mush years.

Now any journalist could make a story, alleging corruption. Many people would likely believe or disbelieve based on personal bias.

I hope this example would suffice to hint that SROs are not exclusive instruments of evil and corruption. These have been misused in the past and may be even now. But that does not mean that the word SRO is a synonym for corruption. It is in fact a part of our system because there is a legitimate need for it.

 

[Luftwaffe]

Didnt they learn from Greece?

Why would old geysers learn. Wire Transfers open hain sab chor Monday sey Tuesdays paisa transfer karnay office jatay hain.

A country like Pakistan can't afford it, we've to collect each every penny to build reserves. These are pretext that "not always" under which massive corruption takes place. It is on the record you can walk in SBP and ask for the written off loans like bagharat they'll give you accurately information but then they'll tell you well there were hard times and this and that. Just a simple example how dar gave loan to his son and told him this is qarz e hasa this is on the record not some made up story...shameless.

 

[Dubious]

Ahem. A reality check is called for here.

Not every exemption is corruption. It is easy to be pessimistic. But one ought to be accurate.

SROs are issued upon applications made by ordinary business people too. For example elecricity bills routinely include sales tax that used to be refunded upon application. But this route meant long wait and having to bribe low level officials to speed up refunds. Many manufacturers applied for exemptions from sales tax in electricity bills. Successful applicants (as a matter of course there were many) had SROs issued, exempting them from this nuisance. This happened during Mush years.

Now any journalist could make a story, alleging corruption. Many people would likely believe or disbelieve based on personal bias.

I hope this example would suffice to hint that SROs are not exclusive instruments of evil and corruption. These have been misused in the past and may be even now. But that does not mean that the word SRO is a synonym for corruption. It is in fact a part of our system because there is a legitimate need for it.

Understood...but isnt it up to some big boss to sign them off? And our boss is more than happy to sign off anything benefiting the rich?! How will we build reserves if those who can afford wont cough up?

 

[Luftwaffe]

Understood...but isnt it up to some big boss to sign them off? And our boss is more than happy to sign off anything benefiting the rich?! How will we build reserves if those who can afford wont cough up?

Not an easy Answer nor it is so simple but we hope someday some new never tested before fair government would come to power and remove all these old pigs from the offices prosecute them on mass scale, summon and take State Bank of Pakistan's ex- and current Presidents including major banks current/former CEOs and ask them in senate just like ENRON scandal throw them all in jail for atleast 20 years. Hope would be on mass scale industrialists/businesses would be audited with our without their consent under special law passed through parliament and even if these corrupts don't allow it should be over ruled and passed. Alot can be done with right government in place, put everyone on ECL.

 

[Dubious]

Not an easy Answer nor it is so simple but we hope someday some new never tested before fair government would come to power and remove all these old pigs from the offices prosecute them on mass scale, summon and take State Bank of Pakistan's ex- and current Presidents including major banks current/former CEOs and ask them in senate just like ENRON scandal throw them all in jail for atleast 20 years. Hope would be on mass scale industrialists/businesses would be audited with our without their consent under special law passed through parliament and even if these corrupts don't allow it should be over ruled and passed. Alot can be done with right government in place, put everyone on ECL.

I am hoping the same for a new established non biased govt...sadly $$ talks louder than actions of pure heart!

I am also hoping for a new law to be passed where whichever president/ PM or any stupid either in parliament (esp political parties though), industry or bank sector...oh throw in the courts for good measure...where any of the mentioned had caused the state to loose even a 100Rs or more should be fined the same sum and if they try to escape, good ridden but freeze each account inside or outside the country and help yourself to the fine...

Really I would like to see who wants to run for PM with such a law!

Help yourself = like they helped themselves to repeatedly looting the country!

 

[defence_analyst]

IMF condition is to get rid of these tax exemptions by 2015 or 2016, its that right? $5 billion every year is huge amount, can solve a lot of problems instead of begging again and again.