Income Tax being imposed in Gilgit-Baltistan from 1st November
Our Correspondent
Gilgit, October 24: The Gilgit-Baltistan government has, reportedly, decided to impose income tax in the region. According to sources, the income tax regime will come into action from the first day of November, which is also the independence day of Gilgit-Baltistan region.
According to details, the government has decided to collect 10% tax from people whose annual income is above 400,000 rupees and below 749,999 rupeees. People who earn between 750,000 to 1.499 million rupees per year will have to pay 15 % tax, while those earning between 1.5 million – 2.5 million will have to pay 20% income tax. Those earning above 2.5 million per year will have to pay 25% income tax, according to media sources.
The income tax is being imposed through the Gilgit-Baltistan Council, which is a non-elected body comprising of people from Gilgit-Baltistan and other parts of the country.
Sources have informed that 50% concession will be applicable to all local people, but the non-locals will have to pay full tax, during employment or business in the region.
The GBLA is severely divided over the issue of imposition of taxes.
Critics are saying that Pakistan has no legal or constitutional right to impose tax in the region, because it is not represented in the parliament.
Others believe that imposition of the tax will enable the provincial government to reduce dependency on Islamabad, through local income generation.
An official of the GB Council has told the media that around 80,000 people in GB will have to pay the income tax.
While recognizing the merit of using tax as a civil right method to seek politicl autonomy, I personally think that income tax will not only reduce dependency on the center, but it will also make local government more accountable to their electorate, and improve governanace. With better governanace, local government will be less lkely to “sell out” GB’s economic assets, such as mining and water resources. So, in balance, this seems a better route to protect our long-term political as well economic rights than sticking to the old argument
Izhar Hunzai
Decision making in GB is only in hands of Islamabad not in in any GB Personal Either elected or Nominated it only impose decisions on GB without any consent of GB people . if Representation in Parliament is made then its Good to have a TAX in GB.
in the today’s situation without TAX is better, B/c GB haven’t any right on royalties, Tourism etc.ISB is responsible for mess in GB. People in GB are much more educated then rest of country that’s feared ISB ,Instead of doing mess in GB learn from GB & fasten the growth & Development of mother land. people of GB are always ready to serve mother land.
Noor ali Khan
If we want to be less dependent on others we should generate our own income. But authority to utilize the revenue should in the hands of local assembly.
If this decision is taken by local assembly, it is a good approach for the development of local people and region motherland Gilgit-Baltistan. But currently in GBLA our leaders are not competent to take their own decision. Funds will misuse, for three years GBLA didnt invest in the development sector who guarantees that the income tax funds will invest in GB or it will be safe in safe hands. I think its early to take impose tax in GB.
Application of Income tax is good sign towards self- sustainability of the people & Govt of GB. Paying the taxes will cultivate the sense of responsibility among the tax payers, the people of GB and the ones who use the public funds .
A society that is deprived politically or otherwise must realize the importance of Tax net as this is one of the strong components to drive the nation out from the dependent tendency. It is certainly a wise decision to involve directly the people of the area in the progress.
But the question is that who will cabinet the polices and what are the fact sheets that have been prepared before imposing the tax
and why it has been decided in such a hurry?
I personally feel that some thing big for personal gains is cooking in the big pressure cookers of the so called political leaders.
The tax income in the longer will help improve the governance, accountability and the political structure; however he imposition of taxation in GB should be taken with a pinch of salt. The tax revenue collected by FBR (Federal Board of Revenue) in the mainland is a meager 9% of total GDP. Ideally it should be at least at recommended threshold of 15% of GDP. India and Bangladesh are doing far better in this respect. To improve the revenues, Pakistan needs to reform and expand it tax net instead of continually squeezing the pockets of existing tax payers. Tax evasion is considered normal and a number of taxable sectors pay zero tax.
Before imposing any tax regime, we need to understand the anatomy of the economy of GB and its capacity to tolerate various levels of tax burden. What sectors will undergo the new tax regime. What threshold is to be fixed. Will the taxes imposed be regressive or progressive. People in GB already pay a hefty 15% sales tax on majority of purchase transactions. What will be the relationship between the provincial tax and the federal tax with the central government and who will be custodian of the funds. Who will have the authority to collect as well as to spend the funds.
The government of GB needs to take heed of all of these concerns in order to avoid the embarrassment of getting into muddy waters. My suspicion is that once the taxation is imposed in GB, the central government will reduce its funds allocation for GB, demanding from the GB government to increase it revenue collection from taxes, hindering in the short run the economic growth in the region.
Taxation without a proper planning will be detrimental to the progress of GB. If the gains from the taxation are marginal compared to the losses of the tax payers then little will be achieved from the exercise. Am i too optimistic when i say that authorities in GB have done their home work properly before embarking on such a move?
Ashabullah Baig
Thoughful comments Ashabullah.
One suggestion would be to start with a ‘qualified tax regime’, taking care of all the concerns that you have listed. One such idea would be to pool GB income tax and create a ‘trust fund’ for developing GB’s strateguc resources, such as hydropwer. An estimated tax base of 80,000 people could generate somewhere between PKR 5 to 8 billion annually. This money can be leveraged three times and invested in say Bunji hydropwer project. In 10 years, GB can be fiscally independent, and then all the tax payers could be given shares in the income from Bunji project.
It is indeed a brilliant idea to allocate the income from taxes in GB to exploit the natural resources as well as to improve the infrastructure and the social sector. Much of the responsibility rests on the shoulders of the political representatives and government functionaries in GB. The time has come for them to assert themselves and improve their capacity for governance.
Tax imposition will led GB toward development but will demands to strength transparency and accountability factor in both collection of tax and effectively bring it into play. If the governance capacities and senesce of responsibility improves and financial autonomy is fully entrusted to GBLA; post tax situation would be at an advantage, otherwise more terrible. Protection and exploitation of indigenous recourses and developmental investments are the only way to perk up the local economy and generate employment opportunities but all depends that how better decision autonomy evolves and subsists.
G.M Shimshali
Just a quick and random response. This news generates tsunami in the blood. The one sided and dictatorial decision of imposing tax on the people of Gilgit Baltistan is ridiculous. It is true that Islamabad has no legal/constitutional rights to make this decision as;
• GB is not a constitutional province of Pakistan,
• It’s rather a “province like provincial set up”,
• Which is completely temporary,
• There is no constitutional recognition to the existing setup,
• GB has no representation in the Parliament or the senate,
• It is not eligible to receive royalty for its resources,
• It does not have independent governance system,
• UN declaration of GB being controversial still exist,
• When GBians approach the Supreme Court of Pakistan for a major issue, SC regrets, as GB does not fall under its jurisdiction,
• More importantly, GB is not part of the NFC Award,
How can you make such an illegal decision?
Government should revert this decision and realize the sufferings and deprivation in the region. Otherwise, I fear the situation will be out of control of the authorities, as people have had too much of inferiority, unemployment, discrimination, prejudices, sectarian clashes, dependency and social injustice.
How many MNA`s & Senators in National Assembly & Senat from Gilgit-Baltistan? Beside that 12 MNA`s & 7 Senators from FATA why they are not paying taxes even other utility bills? Nice gift from corrupt Govt to Pakistan from GB.on Independence day. Saanp or Bhutto ko sath dehkho tu Bhutto ko pehly marooo,,,,
Dear Humble Friends!!!!!
I am really astonished few of the very learned personalities and their comments in favor of taxations taking in view only the one side of the picture that seems a bit brighter. I do agree on self dependence and financial stability if some mechanism which was devised looking and understanding that are workable and success in our globe on the Developed part. In my opinion that seems nor really but a dream for the People of Pakistan. Do the people who are prepared to implement the Taxation in GB do understand on whom the tax is implementable and what what is the terms and condition in global and national level the Devised Rule to implement it. How many of our Respectable GBC’s have the expertises of Taxations and How many consultants they have hired to work on it and them at a morning Tea they are deciding to Implement it but in what shape???
Quote from Mr. Aziz:
“Just a quick and random response. This news generates tsunami in the blood. The one sided and dictatorial decision of imposing tax on the people of Gilgit Baltistan is ridiculous. It is true that Islamabad has no legal/constitutional rights to make this decision as;
• GB is not a constitutional province of Pakistan,
• It’s rather a “province like provincial set up”,
• Which is completely temporary,
• There is no constitutional recognition to the existing setup,
• GB has no representation in the Parliament or the senate,
• It is not eligible to receive royalty for its resources,
• It does not have independent governance system,
• UN declaration of GB being controversial still exist,
• When GBians approach the Supreme Court of Pakistan for a major issue, SC regrets, as GB does not fall under its jurisdiction,
• More importantly, GB is not part of the NFC Award,
How can you make such an illegal decision?
Government should revert this decision and realize the sufferings and deprivation in the region. Otherwise, I fear the situation will be out of control of the authorities, as people have had too much of inferiority, unemployment, discrimination, prejudices, sectarian clashes, dependency and social injustice”
I do agree with Aziz.
Gilgit baltistan is the deprived part of paksitan from 1947 and the government can not give any attention on this area but how they are going to impose taxe even we have no any single reprasantavtive in national essambly or sanet and GB is even not nominated for NFC funds..the masses of GB can never except this decision which just defend the intrest of centrral government.
i knew it what was the reason Mr. Zardari was visiting GB? Its a shame on the Government first do something for the people of GB than you can ask them to pay for taxation? Where does collected tax goes to where does the alreadyrevenue go to……..in the pockets of all the Ministers from Pakistan? This all scenerio seems to me a VOID.
Imposition of tax without representation will further intensify the feeling of alienation among the people of Gilgit-Baltistan…provide representation to the people of GB or stop this stupid action of the govt.
Ist of all the people of Gilgit Baltistan (GB) should be given their rights and the GB should must be included constitutionally in the territories of Pakistan. Once can easily understand that GB is not part of Pakistan in terms of article 1 of the Constitution of Islam Republic of Pakistan. In this article the areas i.e. territories of Pakistan has been defined but there is no wordings about the GB which means constitutionally we are not part of Pakistan. The successive governments have played their double role, in one hand we are said to be Pakistanies and Shaheed Lalak Jan had been awarded the highest military award NISHAN E HYDER but at the same time his is being deprived of his right to file a constitutional petition under article 199 just because of un-consrtitutional status and his petition out rightly be dismissed for want of his unconstitutional status, is this not a joke with the people of GB.
In my opinion ist of all the status of GB should must be declared and a proper province should must be declared by making necessary amendments in the existing constitution of Islamic Republic of Pakistan, then talking about imposition of taxes should be addressed. Otherwise the innocent people of GB now cannot afford any attorcities being meted with the people of the very sensitive area, now it is high time to take into confidence the people of GB otherwise we have many options. It is on record that our forefathers had liberated this beautiful land from the Dogras specially the people of Yasin and District Ghizar who played very important role and it is evident that the Raja Gohar Aman specially played very important role after liberation they volutarily acceeded Pakistan with a hope they would be being at par with the rest of the people of Pakistan but unfortunately since last more that 6 decades we have been ignored, only lolypop is given to the people of “GB”. So without making any amendments in constitution imposition of tax would not be acceptable to the people of GB
Well said Taqdir sahab – GB is NOT constitutionally part of Pakistan. I do not understand some educated folks here commenting in favor of taxes imposed by whatever council obeying the instructions from their colonial masters in Islamabad..
I am still confused as to any option available for Gbians or any opportunity available to disassociate ourselves from the Pakistani tag? Well I guess our area is born in a wrong place.
May God protect us,
WELL, TAX SHOULD BE LINKED WITH CONSTITUTIONAL STATUS TO GILGIT BALTISTAN, AS YOU ALL KNOW VERY WELL THAT GB IS NOT A PART OF PAKISTAN CONSTITUTIONALLY, SO ARTICLE ONE SHOULD BE AMENDED AND GB SHOULD BE INCORPORATED/INCLUDED IN THE LIST OF TERRITORIES OF PAKISTAN. OTHERWISE UNCONSTITUTIONAL STEPS ARE NOT ACCEPTABLE TO THE INNOCENT PEOPLE OF GB. LALAK JAN HAS BEEN AWARD THE HIGHEST MILITARY AWARD NISHAN E HYDER BUT HIS SON CANNOT FILE CONSTITUTIONAL PETITION (CP) BECAUSE OF UNCONSTITUTIONAL STATUS OF GB, IS THIS NOT A JOKE WITH THE PEOPLE OF GB…….?
It is really astonishing that why still our political leaders are unfamiliar with the ground reality. If they have realization than they should ask the same decision makers or tax imposers to declare the GB ‘s constitutional status. If they have not authority to declare it as constitutional part of pakistan than they are not entitled to make decisions about GB.Through news papers it reveals that mostly the political leaders and council members are opposing the tax imposition without granting constitutional rights.
We expect with the CM and Governor to satisfy the GBians , their colleagues ( MNAs,GB Council) and leaders of all parties and think tanks of GB as well.