PowerPoint Presentation

PRESENTED TO; Prof. Zaroon peerzadaPRESENTED BY;

Fatima Masood BE 17 Hafiza Ayesha Mukhtar BE 27Chaman Gul BE 36Noor Ul Ain BE 47Saba Riaz BE 59Saima Ishfaq BE 62

TOPIC TAX CULTURE IN PAKISTAN

TAXA feecharged by agovernmenton aproduct,income, or activity.

Compulsorymonetarycontributionto thestate'srevenue, assessed and imposed by agovernmenton theactivities, enjoyment,expenditure,income,occupation,privilege, property, etc., ofindividualsandorganizations.

TAX CULTURE EVOLUTION OF TAX CULTUREIt was more than 70 years ago that Schumpeter used the term Tax Culture in his celebrated article Economic and Sociology of the Income Tax. Schumpeterian view point is that

Tax Culture is an expression of human spirituality and creativity STUCTURE OF TAX

Direct taxIndirect tax TAX CULTURE A country-specific tax culture is the entirety of all relevant formal and informal institutions connected with the national tax system and its practical execution, which are historically embedded within the countrys culture, including the dependencies and ties caused by their ongoing interaction

TAX CULTURE

TAX CULTURE IN PAKISTANTax culture depends upon on direct taxes

But Pakistan earns tax revenue 25% from direct taxesAnd 75% from indirect taxes DIRECT TAXES AND INDIRECT TAX CONTIBUTION TO TAX REVENUETAX CULTURE IN PAKISTANTax culture in Pakistan is lacks tax compliance undeniably weakLow tax base,unlimited short filers and non-filers, and Lacks enforcement of tax laws etc.Low tax to GDP ratio

TAX TO GDP RATIO comparison with other countries

FBR statistics TAX COLLECTIONTax HeadsCollectionFY: 12-13ProjectionsFY: 13-14Growth (%)Share (%) FY:13-14Direct Taxes743.4975.031.239.4Sales Tax842.51,054.125.142.6Federal Excise121.0166.937.96.7Customs Duty239.5279.016.511.3All Taxes1946.42,475.027.2100QUATERLY COMPARISONRefunds/ RebatesDifferenceQ1: 13-14Q1: 12-13AbsoluteGrowth(%)Direct Taxes7.79.4-1.7-18.9Sales Tax10.512.2-1.7-14.1Federal Excise00.1-0.1-100.0Customs1.72.5-0.8-29.9All Taxes19.924.2-4.3-17.8YEARLY COMPARISONHeadsJuly-SeptemberGrowth(%)2013-142012-13Gross170.7148.215.2Refund7.69.4-18.9Net163.1138.817.5FBR TAX REVNUE & TAX TO GDP RATIORECOMMENDATIONS.Create accountability Tax rate should be reduceStrong surveillance systemTax law should be Simplified.Strong corruption lawShould be cover Loopholes in tax subsidy and Grants.

REASONS OF NOT HAVING TAX CULTURE IN PAKISTAN Weak surveillance systemCorruption in tax departmentTax rates are too highLack of transparency in government expenditureAbsence of social security systemAgricultural exemption

CONTINUED.Complex tax system.Inefficient tax authorities.Ineffective enforcement of law.Generation of black money in public sector.Low tax morality.

CONTINUED.Annual Information ReturnRestructuring the top structure of FBRAudit and inspectionMore focus is given to direct taxesTax money should spend on public welfare and infrastructure projects