Who Owns Pakistan - Yimg

C) Operating charges of new storages constructed under government directives.
An estimated Rs 35 billion is expected to be collected by Development
Surcharge on oil and gas during 1997-98. Meraj Khalid govt had estimated that
price equalization fund alone was costing Rs 13 billion to the govt and therefore
announced a time-frame for removal of freight equalization subsidy. The decision
has been shelved and an eyewash of the former scheme is on the anvil under
which petrol pump owners will be supplied petroleum products at ex-factory
prices.
Capital Value Tax (CVT)
It was introduced in 1989 on transfer and sale of certain assets. CVT is payable
when a property or an asset is acquired by individuals or companies. It was
leviable on plots sold and alloted by develoment authorities, new and used motor
cars and on urban property. The scope of CVT was expanded in 1996-97 budget,
by levying it on air-tickets for foreign travel. It is charged at rate of 2.5% on
immovable property, 1.5% on air tickets, at 1.5% on up to five year cars and 3.75
to 7.5% on 800-1600 cc cars.
Taxes for Rich
While politicians and bureaucrats talk in concert about the evasion of income tax
they seldom raise hue and cry about the evasion and exemptions in taxes which
are meant to serve a dual purpose raising public revenue and improving vertical
equity. The wealth Tax, Capital Gain Tax, Estate Duty and Gift tax were all
designed as leveler of wealth to prevent the rich from getting richer but over the
years, their effectiveness has been eroded through exemption or they have been
abolished altogether, without any qualms.
Wealth Tax
This tax was introduced in 1963 and was payable by individuals, partnership
firms, association of persons and private limited companies but public limited
companies and state enterprises were exempted. Section five of the wealth tax
act exempted agricultural land from payment of wealth tax but 1977 budget
required payment of wealth tax by people having other income also.
Many countries have abolished wealth tax in favor of a progressive taxation
system and in Pakistan also there has been a demand for abolition of wealth tax
on the ground that it helps create black money. The biggest argument against the
tax was that yields from wealth tax are not worth the hassle and administrative
machinery assigned to collect it. The wealth tax is also used by the tax evader to
camouflage their tax liability, since the amount paid as wealth tax is deducted
from the total income earned, to determine the total income tax liability. (also see
Robber Barons of Pakistan).
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