ISLAMABAD - The government is likely to announce an amnesty scheme for Pakistanis to declare their foreign assets by paying nominal tax of two to five percent in next few days, which would generate upto four billion dollar.
"The proposed scheme is in final stages, as we have sent the summary of the scheme of to the prime minister for approval," said an official of the Federal Board of Revenue.
He further said that FBR has proposed that Pakistanis should declare their foreign assets by paying nominal tax of two to five percent. "We have estimated to raise around two to four billion dollars through this amnesty scheme," he added.
Prime Minister Shahid Khaqan Abbasi few days back announced that government will bring a one-time amnesty scheme to allow Pakistanis to declare their assets abroad.
The official informed that FBR has proposed the scheme on the pattern of the Indonesian tax amnesty model. The Indonesian had materialised $30-40 billion by offering an amnesty scheme to attract people to declare their foreign assets. The government is likely to issue a presidential ordinance for the amnesty scheme, he added.
Former State Bank governor Dr Ishrat Hussain had recently advised the government to follow the Indonesian example, which materialised $30-40 billion by offering an amnesty scheme to attract people to declare their foreign assets.
However, the business community has sought separate amnesty schemes for local and expatriates.
"The government should offer separate amnesty schemes for local and foreign Pakistanis that would help in broadening the tax base and improving the tax revenue of the country," the Islamabad Chamber of Commerce and Industry (ICCI) demanded on Saturday in a statement.
ICCI President Sheikh Amir Waheed has said that Pakistan was facing the challenge of low tax revenue and low tax to GDP ratio. However, many Pakistanis living within the country and outside were possessing significant hidden assets and money that could be brought into the mainstream economy by offering separate amnesty schemes.
He said offering such amnesty schemes at a time when Pakistan was facing decline in exports and rising trade as well as current account deficit would be a right move to bring more investment and money in the formal economy.
The president ICCI said the tax amnesty scheme could also help in accelerating the economic growth through production and utilization of hidden liquid assets in the main stream of the economy.
He said it has become a common observation since last several years that the capital of Pakistani residents and non-residents was being invested in Middle East, Far Eastern countries, Western Europe and off shore Island in Southern Pacific and stressed that the main objective of the amnesty schemes should be to stop the flight of capital from Pakistan.
He said that the high tax rates always promoted a culture of tax evasion and stressed that government should focus on reducing the tax rates and widening the tax base that would help in improving the tax revenue of the country.
He said the government should also introduce a fixed tax rate for the real estate sector to give boost to business activities in the property and construction sector.