According to reports, in Pakistan, only two million people pay taxes from a population of more than 180 million. It means only one percent population is in the tax net. This is not the correct position. There are two types of taxes; namely, direct taxes levied on incomes, profits, fees, wealth, property etc; and indirect taxes, which everybody, unobtrusively pays. These indirect taxes include duties on imports, raw materials, consumer goods and so-called luxury items like cigarettes and cell phones which low-income groups also use.
It means that 100 percent of urban population pays taxes, direct and indirect. A large chunk of rural population also pays taxes of some kind. Even a low-paid construction worker and a beggar using a cell phone also pay tax to the government. So the reports about only two million people paying taxes are erroneous and misleading. All salaried persons, in private and public sectors, pay income tax, according to law. However, rich and influential people, mostly politicians and business tycoon, do not pay taxes.
ASGHAR MAHMOOD
Islamabad
