The Karachi Chamber of Commerce and Industry (KCCI) has suggested that the agriculture sector should also be equally taxed like other sectors of the economy in order to strengthen revenue collection.
“Such an unnecessary exemption to high agriculture incomes creates a distinct disequilibrium and a sense of injustice, besides providing a safe haven for whitening money,” the chamber said.
It said that the imposition of an agricultural income tax on large and medium farmers would significantly increase revenue collection, besides it would also help reduce poverty in the country.
The chamber said that agriculture related activities contributed around 21 percent to GDP, while revenue collection from agricultural income tax was less than one percent of the total collections.
“Leaving huge agricultural wealth untaxed while taxing salaried individuals, entrepreneurs and businessmen is akin to breeding inequality and injustice at the whims of a few influential individuals and entities,” the chamber observed.
It said that to create a level playing field, every source of income must be indiscriminately taxed, whether it be from agriculture or non-agriculture, as exempting agriculture from taxation burdened the rest of the economy and caused significant revenue loss for the government.
The chamber was of the view that enhanced agriculture taxation would make the provinces more self-sufficient and reduce the burden on the federal government. The chamber asked the provincial governments to realise the gravity of the matter and strengthen the existing agriculture taxation laws and also ensure their implementation in letter and spirit.
Source: Business Recorder