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Finance Minister Urges Strict Enforcement of Tax Laws for Economic Stability

In a media talk on the second day of Eid Ul Azha, Finance Minister Muhammad Aurangzeb expressed the challenges the federal government faces in providing relief to the salaried class in the new budget, while many state institutions are operating at a loss. He emphasized the need for strict enforcement of tax laws and phasing out tax exemptions to reduce the fiscal deficit.

While Aurangzeb acknowledged the importance of charity-based operation for hospitals and schools, he highlighted that a country’s economy cannot solely rely on it. He also announced the government’s decision to maintain tax exemptions on fertilizers, seeds, and medicines to support the agricultural sector.

Crucial Steps Towards Economic Stability

Aurangzeb emphasized the necessity of bringing all sectors into the tax net and stressed the urgent need for end-to-end digitalization at the Federal Board of Revenue (FBR). This would minimize human interaction, reduce corruption, and increase transparency, he explained. Expanding the tax net beyond retailers to include various other sectors was also highlighted as crucial for the country’s GDP and overall economic health.

Addressing public concerns about harassment and frivolous notices from the FBR, the Finance Minister promised reforms to improve the system and make it more user-friendly.

Fiscal Deficit Management and Privatization

Regarding fiscal deficit management, Aurangzeb announced plans to cut federal expenditures. He emphasized the importance of privatizing loss-making state-owned enterprises (SOEs), with a particular focus on Pakistan International Airlines (PIA), which has a liability of Rs. 622 billion transferred to the government. Aurangzeb called for immediate privatization of all liable SOEs, stating that the current situation is unsustainable.

As part of the government’s privatization efforts, Karachi Airport is expected to be outsourced by August, reducing the fiscal burden on the government. The Finance Minister highlighted the government’s focus on leveraging the private sector for national development and urged the integration of technology with the agricultural sector.

Independence of Agriculture and IT Sectors

In response to a query, Aurangzeb stated that the agriculture and IT sectors are independent of the International Monetary Fund (IMF). He commended freelancers for their contributions, particularly while working from home.

The recent visit to China by Prime Minister Shehbaz Sharif and Aurangzeb focused on technology transfer to Pakistan rather than seeking additional investments. Notably, visits to Chinese agricultural research universities were also included in the itinerary.

Source: Propakistani