Lahore, May 4, 2024 – Prime Minister Muhammad Shehbaz Sharif on Saturday outlined Pakistan’s potential to substantially boost its tax revenues, stating the country could amass over Rs 24 trillion annually, a stark contrast to the current tax target of Rs 9.4 trillion.
During a ceremony in Lahore where he recognized the Federal Board of Revenue’s (FBR) most diligent officers, the Prime Minister Shehbaz addressed the substantial revenue losses Pakistan faces due to corruption, inefficiency, and negligence. He emphasized that effectively capturing this lost revenue could triple the current collections, thereby providing substantial financial resources to repay national debts and invest in critical infrastructure such as hospitals, schools, universities, and roads.
“The amount of revenue that is slipping through due to inefficiencies is alarming and highlights the urgent need for systemic reforms within our tax collection mechanisms,” said PM Shehbaz Sharif. He added that the time has come to “separate the white from the black” and ensure that decisions regarding rewards and punishments are made solely on merit.
The Prime Minister also discussed several challenges Pakistan faces, including a low tax-to-GDP ratio and escalating external and internal debts. Highlighting the legal reforms underway, he pointed out that approximately Rs 2.7 trillion is currently stalled in various appellate forums. New laws have been enacted to expedite the recovery of these funds, involving the appointment of ATIR members through a rigorous, competitive process facilitated by leading institutions like LUMS and IBA.
Moreover, PM Shehbaz Sharif addressed the recent uncovering of a Rs 756 billion sales tax scam, asserting his directive for aggressive recovery efforts of these misappropriated funds.
The event also served as an occasion for the Prime Minister to commend the integrity and dedication of the FBR’s officers, whose efforts are crucial for the nation’s economic stability and growth. “It is essential that all stakeholders, including politicians, bureaucrats, and organizational leaders, work collaboratively towards the nation’s development,” he stated.
Finance Minister Senator Muhammad Aurangzeb, speaking at the ceremony, reiterated the critical role of revenue collection in socio-economic development. He disclosed that of approximately 3 million commercial and industrial electricity and gas connections, only 200,000 are compliant with their sales tax obligations. The Minister emphasized the importance of executing existing policies with greater efficiency, transparency, and honesty to fast-track the country’s economic growth and development.
Chairman FBR Amjad Zubair Tiwana expressed gratitude towards the Prime Minister for his active role in promoting enhanced tax revenue measures. Tiwana remarked on the numerous discussions and meetings the Prime Minister has spearheaded to tackle the issues within the tax system.
This focus on maximizing tax collection is part of Pakistan’s broader strategy to improve governance and economic management, with an ambitious goal to outpace regional competitors like India in terms of development and prosperity. The government’s renewed commitment to tax reform is seen as a pivotal step towards achieving these objectives.
