Zardari asks Nawaz to support RGST

Replying to a letter by PML-N chief Nawaz Sharif, President Asif Ali Zardari sought his support regarding the Reformed General Sales Tax (RGST) Bill.

Zardari stated that it was the PML-N senator Ishaq Dar who had agreed to impose the tax through 15 amendments sent to the National Assembly.

In a detailed reply, President Zardari said that the PML-N should come up with suggestions on how to deal with issues the country was facing at the moment. He said that the PML-Ns reservations with the accountability bill would also be addressed. The PML-N had insisted that the head of the accountability commission should be a sitting judge of the Supreme Court of Pakistan.

The president also said that the government has nothing to do with petroleum prices as they were linked to the international market. He added that an elaborate business plan was being developed for national institutions, such as Pakistan Railways and Pakistan International Airlines (PIA), to make them more profitable.

The PML-N chief had earlier written a letter to the president, extending full support of his party if the government agreed to the PML-Ns agenda.

Opposition is not anti-Govt, claims Gilani

I have not given the government in charity; the whole House gave me the vote of confidence, said Prime Minister Yousuf Raza Gilani on Wednesday while addressing the federal cabinet.

Gilani said changes in the cabinet were unavoidable, adding that more decisions will be taken in order to ensure good governance.

The Premier maintained that the Opposition motions by the government The cabinet was also considering the governments strategy on the Reformed General Sales Tax (RGST).Referring to the sacked ministers’ issue, Gilani said that both the federal minister were dismissed for their mudslinging at each other in media.

On Tuesday, Prime Minister Gilani sacked Religious Affairs Minist
er Hamid Saeed Kazmi who was under scrutiny over mismanagement in this years Haj arrangements, and Science and Technology Minister Mohammad Azam Khan Swati, who submitted a statement in the Supreme Court alleging Kazmi of corruption.

Pakistan Muslim League-N (PML-N) Rejects RGST

Lahore, News Trends :- The Pakistan Muslim League-N (PML-N) will not support the federal government on the issue of the Reformed General Sales Tax (RGST) and will not allow the government to increase the burden on the masses, party Chief Nawaz Sharif has said while
addressing a public gathering in Sheikhupura on 11th December. Nawaz Sharif took a right stand and suggested the Pakistan People’s Party-led government should focus on eliminating corruption instead of increasing taxes. He urged the need of a revolution needed to combat the troubles faced by the people, and to fight unemployment, poverty and injustice.

An IMF team is present in Islamabad to ensure implementation of tax reforms. The reforms in the general sales tax to be introduced through proposed General Sales Tax Act, 2010 would help achieve the desired target of documentation of economy and would remove exemptions available to various sectors. Some informal sectors are also to be brought under GST regime which is even more than formal sector. Documentation required through the proposed legislation would not only to document each and every transaction after import or local production at all levels but also to help document annual turn over of the businesses for determination of income tax liability of the registered entities.

There is no doubt the State is in dire need of increasing its tax revenues by broadening its tax base which has increasingly became distorted and narrow-based due to poor Government policies. But it is duty of the Government to keep the tax burden as low as possible and increasing the numbers of taxpayers simultaneously ensuring that taxes are applied equally and fairly to everyone. The government should rather reduce tax rates on income and business profits that help to sharpen incentives to work and create wealth in the economy as a strategy to enhance long-run growth. Tax base should be broadened by levying Direct taxes on “pay as you earn” basis instead of levying frequent indirect taxes like RGST which is highly inflationary and passed on by the suppliers to the final consumers, or highly taxing the people through escalation of prices of oil, electricity and gas etc. The overall taxes that a person pays can be reduced by proper planning and making appropriate adjustments; it should be governed by people’s ability to pay, that is, wealthier individuals or firms with greater incomes should pay more in tax while those with lower incomes should pay comparatively less and every sector of the economy should be taxed.

The current system of taxation is completely ineffective – which needs to be revolutionized by bringing more people in the tax-net. Corrupt, inept, dollar-hungers and downright cheesy characteristics sums up the personal attributes of the vast majority of Pakistani politicians and generally the closed club of Pakistan’s ruling elite, barring few gentle exceptions. They formulate the policies keeping in view their personal interests instead of that of the nation. Policies are modified even for one person or one class. Due to these reasons a good tax culture could not find roots in Pakistan. Only poor of the poorest and salaried class persons comes in the net of taxation and “elite club” is always exempted from all sorts of taxes. The MNAs, MPAs, Minister and other Government dignitaries who want taxes from the poor public, themselves do not pay taxes. Pakistan’s Taxation system is characterized by widespread tax evasion, and annual tax evasion by the “Elite Club” comprising politicians, military and civil bureaucracy, and some businessmen stands at around Rs.1000 billion. Just imagine many ministers – majority of whom are feudal lords with big land holdings – including Prime Minister Yusuf Raza Gilani, paid taxes based only from their salaries as lawmakers, not from their private fortunes. There are even ministers who have paid less than 10,000 rupees (US$117 ) as their annual income tax. Due to a non-transparent process and weak accountability system, public sector expenditures are officially misused by the ruling elite, thereby, kickbacks and pilferage of revenue is in connivance with the public officials.

The state is responsible to provide basic fundamental rights and facilities but has totally failed to fulfill expectations of the poor people. People are more frustrated when they see the ruling elite’s social life and their living standards. If you go down in the markets or any other public places and listen to people’s views, you would wonder whether our politicians are in touch with their people or doing something for them. This is in sharp contrast to the common people. We should admit that non state actors, militants and extremists have again consolidated their positions due to the government’s poor policies. This is perhaps the last chance for our ruling elite to mend their ways and restructure their policies and politics in line with the people’s expectations. To impose a Reformed General Sales Tax on an already highly impoverished society is not the answer, especially since this is more likely to worsen an already untenable situation as legions of micro-businesses react to the new tax by shifting to the informal sector. The correct response is to strengthen direct taxation, especially on the wealthy land-owning elites who dominate Pakistan’s quasi-feudal society. Introducing land value taxation and strengthening tax compliance among rich people and companies should be the medium term priorities. They should keep in mind; only a surfer knows the feeling.

In the end, I would humbly request my brothers and sisters countrymen for God sake; your vote is your voice and there is more power in it then in most things you do. It is a lost pleasure, the power of that voice. Use it. It should make no difference if that one comment does not carry the decisive power, but it will resound in Pakistan. Raise your voice for an independent judiciary; rule of law and social justice, rake over coals the renegades and traitors. Choose your brave and honest heroes out of your own rows, salute them, and help them help you! Due to our constant wrong use of vote or avoiding its use, corrupt politicians have created the issue of survival of Pakistan and Pakistani society. On the one hand people are committing suicides due to starvations and financial hardships and on the other hand assets of a few politicians, bureaucrats, and some businessmen are expanding with each past day. Stand for your rights and social justice from today. God will help us, Inshallah.

Govt. decides to call joint parliamentary session on Dec. 18

Staff Report

ISLAMABAD: The government has decided on Thursday to call a joint parliamentary session on December 18 and National Assembly’s session on December 20.

The Ministry of Parliamentary Affairs has sent an official summary, for calling both sessions, to President Asif Ali Zardari.

During the joint session, one house will present other house’s rejected bills, under the 18th Amendment, for the approval. Before 18th Amendment a mediation committee was formed for such rejected bills.

According to sources, in the session of National Assembly, on December 20, the Reformed General Sales Tax Bill can be presented for discussion. Trend Pk

PML-Q decides to vote against RGST

Staff Report

ISLAMABAD: The Chief of Pakistan Muslim League Quaid-e-Azam (PML-Q) Chaudhry Shujaat Hussain has announced on Saturday to vote against the Reformed General Tax (RGST) bill in the National Assembly.

During the press conference, Chaudhry Shujaat said that the members of his party would be declared ineligible, if they go against the party decision. Trend Pk

Reformed GST not to affect common man

ISLAMABAD: Information and Broadcasting Minister Qamar Zaman Kaira has said the Reformed General Sales Tax (RGST) which is aimed at broadening the taxation net base would not affect lives of the common people

Talking to media after attending the launching of series of programmes on Faiz Ahmed Faiz here at Radio Pakistan he said, that GST reform was the part of budget document presented this year, but was delayed for more deliberations with different stakeholders.

The Reformed GST has also been approved by the Cabinet and Council of Common Interests (CII), he recalled.

The minister said that all the chief ministers have agreed on GST reforms in the meeting of the CCI.

He said the government was aware of the problems of common man and implementation of RGST would not disturb their routine life, rather burden would be shared with those who are capable of

Basic draft agreed upon for reformed GST implementation

ISLAMABAD: The basic points in legal draft of the reformed General Sales Tax (GST), would be finalized by the end of the current month, Geo News reported Wednesday.

The finance secretaries of the four provinces would hold a meeting for consultations to the give the final touches to the draft.

Talking to Geo News, Federal Board of Revenue (FBR) chief Sohail Ahmed said chief ministers of the four provinces consented on the basic draft in the presence of Prime Minister Syed Yousuf Raza Gilani for the implementation of the reformed GST.

Soahail Ahmed said the government is all geared up to complete the final draft by August 15 for an agreement on the reformed GST , so that it could be tabled before the Parliament by August 30 for legislation.

But, prior to this, the law will have to be passed by all four provincial assemblies, he added.

Cabinet announces one-day national mourning

ISLAMABAD: The Federal Cabinet on Wednesday expressed shock and deep sorrow over the tragic air crash on Margalla Hills and announced a day of national mourning.

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Cabinet announces one-day national mourning

PM constitutes committee on Reformed GST

ISLAMABAD: Prime Minister Syed Yusuf Raza Gilani on Wednesday constituted a Special Committee headed by Finance Minister to finalize collection of Reformed GST within two weeks.

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PM constitutes committee on Reformed GST