Govt urged to improve taxation systemV

ISLAMABAD    -   Supporting the remarks of IMF Deputy Managing Director urging Pakistan to capitalise on hard-earned stability through sound economic policies, Islamabad-based think tank, Capital Calling, has said that strict implementation of policies on the subject would bring economic stability and improve tax collection including increased taxes on tobacco products in the country.

Following the previous IMF Executive Board meeting, Deputy Managing Director and Chair had pressed on the country to “capitalise on this hard-won stability...with sound macroeconomic policies and structural reforms to create stronger, inclusive, and sustainable growth.”

The Capital Calling said that taxes on non-essential items like cigarettes should be brought at a par with international standards. The WHO parameters set for taxing cigarettes take into account the volume of mortality and morbidity that these products cause in the society. Research reports have mentioned that over 24 million Pakistanis are active smokers inflicting irreparable damage on passive ones.

The country has turned into a haven for cigarette production as it was counted among the 9 poor states that account for production of 90 percent of cigarettes for the world.

It remarks that the government’s alleged reluctance to change tobacco tax policy is partly due to its failure to fully appreciate the smoking-attributable fraction of health and social costs. It called for taking the health cost of cigarettes into account at the time of fixing taxes on this sector so that it does not lose its hard-won stability.

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