Taxing cash withdrawals will be last nail in coffin of sinking economy: Atif Ikram

ISLAMABAD: Former Vice President of Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Atif Ikram Sheikh on Wednesday said the failed experiment of levying tax on bank withdrawals should not be repeated.

In a statement issued here, he clarified that the move would prove to be the last nail in the coffin of our sinking economy.

Such a move will promote the undocumented economy as the business community did not accept this decision before and will not accept it now, he added.

Atif Ikram Sheikh who has also served as President ICCI and Chairman PVMA said that in the past the business community have used their own parallel banking system against the decision of imposing withholding tax on withdrawing money from the banks.

The revolt of the business community sucked huge sums of money from the banking system, he said, adding that at that time, the state of the country’s economy and strength of banks was not what it is today, nor were the big banks of America and Europe were going bankrupt.

It would be appropriate to trash such a proposal which has nothing to do with the ground realities of Pakistan.

He noted that the state of our tax system is in such a bad state that there are only 7.6 lakh people registered with FBR, out of which around Rs4 million file tax returns, while many among the filers do not deposit even a single rupee as tax. “If this proposal is implemented, the entire population will have to pay this tax, except for these people,” he underlined.

Atif Ikram Sheikh said that the burden on the taxpayers and the public is always increased in the name of tax reforms while the tax net is not extended and the non-tax paying sectors are not targeted.

He said that due to increasing direct taxes, endless surcharges, cumbersome paperwork, unfriendly attitude and other problems, the share of taxes in the country’s GDP is so low that it is impossible to increase it without effective measures.

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