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SBP underlines reforms to increase tax revenues

SBP underlines reforms to increase tax revenues

KARACHI: The State Bank of Pakistan has stressed the need for addressing structural problems in the fiscal system to increase tax revenue.

As per details, the SBP, in the second quarterly report issued here, emphasised that taxation reforms should be made at gross-roots level to widen tax base by eliminating a broad range of tax exemptions. It also underlined the need for plugging leakages to minimise tax evasion and enhance compliance besides strengthening the tax administrative capacity.

The SBP report said that broad-based reforms in the energy sector and restructuring of loss-making public sector entities were the prerequisite to contain the fiscal burden and create space for undertaking development expenditure. It said that revival of public investment was likely to crowd-in private sector by expanding opportunities for it. In addition to all these issues, internal security concerns continue to disrupt domestic economic activities. The SBP feared that without a solution to these challenges, it would be difficult to revive domestic investment which was required to put the country on a high growth path.