ISLAMABAD (Dunya News/Web Desk) – With Pakistan aiming at increasing the tax-to-GDP ratio, sources say one of the budget proposals aims at increasing revenue collection from the real estate sector and taking action benami properties – the undeclared assets owned unknown persons or entities which are a big source of legalising the black money.
The proposal under consideration for the next fiscal year 2024-25 budget comes as the government is grappling with a financial crisis and has been trying hard to boost revenue collection and reduce fiscal deficit while improving the tax-to-GDP ratio, which is one of the lowest in Pakistan when compared to other countries around the globe.
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It also coincides with the efforts to secure another International Monetary Fund (IMF) programme for which a team is expected to arrive in Islamabad in the coming days.
The IMF has been pressing Pakistan hard to enhance tax collection by including sectors like property, retail and agriculture into tax net to widen the base – a condition that must be appreciated by both ordinary citizens who have been crushed by indirect taxes and the businesses which have remained the source of meeting the fiscal needs of Pakistan.
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But it isn’t limited to the real estate sector which have been witnessing investment of trillions of rupees, as another proposal seeks action against those retailors who haven’t to register themselves with Tajir Dost App – a scheme introduced earlier to enable them join the tax net.
However, there is a bad news for the people as the government is mulling over subsidy cuts for power and gas consumers – another IMF demand that has been implemented at rapid pace during the last four to five years.
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Moreover, it is also being suggested that the government should work on executing the decisions taken by National Electric Power Regulatory Authority (Nepra) as well as Oil and Gas Regulatory Authority (Ogra).
As part of the austerity measures to reduce government spending under the IMF pressure, the sources say the officials are also mulling over another proposal that says the next budget shouldn’t contain any new project under federal Public Sector Development Programme (PSDP) and budget should only be released for those initiatives which are near completion.
On the other hand, the government would also expedite the privatisation process to dispose of the lossmaking state-owned enterprises (SOEs) and audit the performance of all ministries and departments at federal and provincial levels.