Aurangzeb Pledges to Enroll All Traders in Tax Net

Aurangzeb Pledges to Enroll All Traders in Tax Net

Finance Minister Senator Muhammad Aurangzeb reaffirmed on Saturday the government’s commitment to bring all traders into the tax net, underscoring that no exceptions would be made.

This announcement comes as the government aims to meet an ambitious revenue target of Rs13 trillion set in the FY25 budget.

The increased tax target includes a 48% rise in direct taxes and a 35% hike in indirect taxes compared to the revised estimates of the previous fiscal year. Additionally, non-tax revenue, which includes petroleum levies, is projected to grow by 64%.

Speaking at the regional office of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) in Lahore, Aurangzeb assured business leaders that the government would address the issues faced by traders in the upcoming fiscal year. He emphasized the need to view the budget from a broader perspective, highlighting the economy’s progress towards macroeconomic stability.

The government unveiled the national budget on June 12, targeting a challenging tax revenue goal of Rs13 trillion for the fiscal year starting July 1. This goal, an approximate 40% increase from the current year, is part of an effort to secure a new bailout agreement with the International Monetary Fund (IMF).

Amidst appeals to prevent further electricity price increases, Aurangzeb stressed the need to reform distribution companies (Discos) to avoid continued hikes in power tariffs. He highlighted the importance of both domestic and foreign investments for achieving economic stability through comprehensive budgetary measures. “Foreign investors are as important for Pakistan as the local ones,” he noted.

Aurangzeb advocated for extensive reforms to steer the economy out of its current difficulties, suggesting the closure of redundant federal government departments. “We need to shut down the ministries that have been devolved to the provinces,” he stated.

Addressing the term “non-filer,” Aurangzeb questioned its relevance, noting that Pakistan is the only country where this term exists. He also expressed his opinion on gradually reducing the policy rate to stimulate economic growth. “We should increase the tax-to-GDP ratio to 30% over the next three years,” he proposed, adding, “In my opinion, the policy rate should be reduced gradually.”

Highlighting recent economic milestones achieved by the Pakistan Muslim League-Nawaz (PML-N) government, Aurangzeb mentioned that foreign exchange reserves had surpassed $9 billion. He acknowledged the need to address public dissatisfaction over the substantial allowances enjoyed by bureaucrats and government officials.

“The criticism that the government is not reducing the perks and privileges of the high-ups is justified,” he admitted.

In his concluding remarks, Aurangzeb emphasized the importance of advancing small and medium-sized enterprises (SMEs) and the IT sector to foster economic growth and stability in the country.