It has been emphasized that property should be effectively brought into the tax net and properly registered and taxed. According to the World Bank, the growing burden on the salaried class can be reduced only if the tax net is wide and all income is included in it. The World Bank further said that the revenue system needs to be reformed as the current system is generating short-term benefits but is deprived of long-term income opportunities. Regarding expenditure, PIDE Vice Chancellor Nadeem Javed revealed that 40 percent of the development budget is wasted in the form of commission as no bill is cleared without paying 5 to 7 percent commission of the Auditor General of Pakistan (AGPR).
He said that this is a fact and everyone knows it. “The provincial-level tax on agricultural income is a positive step, now the property sector should also be properly registered and brought into the tax net,” said Tobias Hauck, Lead Country Economist at the World Bank, in a panel discussion at the PID-organized conference “Pakistan’s Fiscal Path: Promoting Transparency and Trust” in Islamabad. “Enlarging the tax net through a digital system and including all income can pave the way for reducing the burden on the salaried class.” He expressed surprise that out of a population of 240 million, only 5 million people file tax returns, and most of the tax is collected in the form of General Sales Tax (GST). “Pakistan’s tax system is unfair in terms of the principles of justice. If the country continues to function with only 5 million filers, no lasting solution is possible.