ISLAMABAD - The Senate was informed Friday that the government is following a multi-pronged strategy to broaden the tax net in a bid to reduce dependency on foreign loans.
Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi on behalf of the finance minister told the House during the question hour that the strategy envisages increasing tax to GDP ratio, bringing tax evaders into the tax net and eliminating tax exemptions.
In addition, he said the finance division has slashed current expenditures upto 30 per cent during the current fiscal year. These expenditures including subsidies will further be rationalized.
The minister said that the State Bank of Pakistan is in the process of improving the incentives regime to encourage remittances by Pakistanis working abroad in order to build our foreign exchange reserves. Similarly, a comprehensive trade policy has been formulated to boost exports over the medium term.
These initiatives, he hoped, are expected to bring the external debt to GDP ratio from 24.3 per cent to 15.6 per cent in the next financial year. Shahid Khaqan Abbasi said that the govt would repay loans of over Rs 400 billion during the current financial year.
Answering a supplementary question on steps taken by the present govt to broaden the tax net, the minister said it was a long-term process and government was making serious efforts in this regard.