Published in The News on September 24, 2013
One of the reasons for not meeting revenue
collection targets by the FBR is the PML-N’s reluctance to introduce value
added tax (VAT), probably because it does not wish to alienate its core
constituency (traders and the business community). If, however, the government
adopts a scheme whereby taxpayers have a chance of being rewarded, it should be
easy to introduce VAT collection nation-wide. Such schemes have been
successfully used in Taiwan, Turkey and the Indian state of Tamil Nadu.
Here’s how we can make it work: when a person
pays more than a certain amount of VAT, he/she would be given a numbered coupon
(those who buy more would be given coupons according to the amount they have
paid as VAT). Using these numbers, a draw would be held every day and prizes
would be given to the persons with the winning numbers. The draw would be
televised nationally, and prize winners would know the results immediately.
Religious scholars should have no objection to this scheme, since prize bond
draws have been acceptable. People would wish to buy only from those stores
that charge VAT and give the numbered coupons. In this way, the government
could collect a substantial amount.
Shakir Lakhani
Karachi
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