The National Assembly on Thursday passed a bill to amend the Income Tax Ordinance, 2001, The Income Tax (Amendment) Bill, 2016, amid strong protest and walkout by the opposition.
The bill was moved by Minister for Climate Change Zahid Hamid on behalf of Finance Minister Senator Muhammad Ishaq Dar.
According to statement of objects and reasons of the bill, a major segment of the national economy is undocumented and a large number of traders who are required to file their income tax returns are either persistent non-filers or are underreporting their income and are depriving the national exchequer of its due share.
It states that in view of the prevailing culture of massive non-reporting and under-reporting, it is expedient to provide a one-time opportunity to the filers as well as non-filers to regularise their tax affairs by adopting a special and simplified procedure for assessment of their tax.
According to note of dissent of the opposition members, the scheme will be counter-productive to the objectives of enhancing government revenue and will send a wrong message to the honest and committed tax payers.
The noted said that the amnesty at a highly discounted rate (one per cent) is unfair and unjust for the tax payers who pay their taxes honestly. “Without FBR reforms, the fundamental reasons why this scheme is being proposed will not change and we will face the same situation in a couple of years.”
Earlier, Opposition Leader Sayed Khursheed Shah raising objections on the bill said that it would shake confidence of the people. He said that such schemes were also introduced in the past but failed as they brought no relief to the people and the government.
PPP’s Sayed Naveed Qamar, PTI’s Shah Mahmood Qureshi, JI’s Sahibzada Tariq Ullah and MQM’s Rasheed Godail also criticised the bill.
Responding to Opposition’s criticism, Parliamentary Secretary for Finance, Revenue and Economic Affairs Rana Mohammad Afzal Khan said that credit went to the present government to bring traders into voluntarily tax scheme. He said that in the past tax amnesty schemes were introduced for profiteers, black marketers and smugglers but there was no such waiver for these people in this scheme.
He said that it would increase tax to GDP ratio and the number of taxpayers would also increase from 700,000 to 1.1 million. He said that FBR revenue collection had increased by 33 per cent during the last two years.
He said that the government had taken all the traders and the various trade bodies into confidence and had taken the decision by majority. He said the scheme was being introduced after thorough discussions with traders’ bodies and experts.