KARACHI: Pakistan Business Council (PBC) has recommended use of cash above certain limit in order to document the economy.
In its proposals for budget 2022/2023 submitted to Federal Board of Revenue (FBR), the PBC recommended that the use of cash in the economy should be discouraged.
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“Restrictions on use of cash above a certain limit would also assist,” the PBC said.
The transit treaty with Afghanistan has been misused through diversion of goods to Pakistan.
The Afghan Transit Trade Agreement has expired, with the evolving situation in Afghanistan, Pakistan needs to look to renegotiate the treaty with clauses putting in quantitative and qualitative restrictions on what can transit, insist on letters of credit, charge duty and General Sales Tax (GST) on import which would only be refunded to the Afghan government on exit, track and monitor containers, strengthen inspection of empty containers returning to Pakistan and make physical controls along the border stronger.
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“The civil and military authorities need to be on the same page to do this,” the council recommended.
Electronic Data Interchange with key trading partners should be deployed to check under-invoicing of imports. The provinces have little incentive to check smuggling as customs duty and GST evaded are federal taxes and do not hurt their revenues.
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Provinces may be incentivized to conduct raids on shops that deal in smuggled goods. Positive lessons from the success of cell phone registration with Pakistan Telecom Authority (PTA) and Urdu language labelling requirement for imported food items can be applied to other smuggling prone goods.
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