20000101

CTA urges govt

to abolish

wealth tax

ANWAR RAJANI

KARACHI: The Council of Textile Associations (CTA) has urged the Federal Government to abolish the wealth tax as this tax has been imposed in Pakistan only and is not levied any where else in the world.

In a communication to the federal finance minister, the council pointed out that several successive governments in the past had promised to abolish this tax but it was retained as a good source of illegal gratification and a means of political victimization.

The government has exempted all income tax assessees having an annual income of Rs 200,000 from submitting wealth tax returns whereas a few have been caught in the wealth tax net even if they have no income at all. The wealth tax is leviable on many persons who have no income at all but have properties or investments worth over Rs 1 million.

Irrespective of payment of income tax, the council has pointed out, logically every motor car owner, every flat and plot holder, particularly those rented out, come into the wealth tax net, but nobody bothers about it, because many such assessees are powerful and the others grease the palm of tax collectors.

It is surprising that the expenditure incurred by the government in collecting the wealth tax is more than the amount collected under this head. Since there was a great criticism on this account, the CBR had cleverly merged the wealth tax department into income tax department and nobody knows whether the expenditure on the collection of wealth tax is more or less than the amount so far netted in this behalf.

The CPA is of the view that wealth tax is a completely un-Islamic, unjust and illogical tax, which is paid by some very clever, smart owners of illegal wealth (in order to legitimize their black money), a few political victims and very honest people. The ground reality is that there are hardly seven percent income tax payers who are paying this Tax. All government officers, private employees, property holders have not been included in the net though all of them are having properties worth more than Rs 1 million.