vat mode for retailers
VAT mode

LETTER (January 28 2009): With reference to Business Talk: 'we have to move towards VAT mode to bring retail sector into tax net' (24th January), I suggest that major incentives be given to consumers to make VAT successful. In many countries (like Turkey, Taiwan and India), consumers paying more than a specified amount of VAT are given numbered coupons.

Every day, draws are held in public and televised live and those holding coupons bearing the lucky numbers are given prizes. With this scheme in force, consumers would buy only from those outlets which recover VAT and pay it to the government.

Secondly, it is essential to impose sales tax on shops which sell smuggled goods. There are many such markets in Karachi alone where smuggled items are sold openly. Later, such markets in other cities can also be targeted. Only the wealthy consumers will be affected if this measure is enforced.
Copyright Business Recorder, 2009