Latest news with #AshfaqYousufTola
Business Recorder
10-06-2025
- Business
- Business Recorder
Tola highlights importance of home-grown ‘Green Pakistan'
LAHORE: Leading economist Ashfaq Yousuf Tola has stressed on policymakers to choose between home-grown recipe of Green Pakistan and IMF policies for growth. The home-grown Green Pakistan, he said, includes keeping policy rates closer to inflation rate; reduce debt servicing; and maintain the currency at its true value; stimulating growth; reduce fiscal deficit, and IMF policies focus on monetary tightening; import led growth, and tariff reduction. To achieve sustainable growth, he said, we must prioritise policies that foster robust economic expansion. These policies include achieving an export surplus by focusing on our key cash crops: rice, wheat, and cotton. Tola said Pakistan can reduce its cotton imports by enhancing cotton yields besides increasing rice exports. Furthermore, said Tola, the FY26 economic strategy must prioritise on introducing targeted policy measures for industrial development. These include rationalising interest rates for industrial borrowers, electricity tariff reduction, abolishment of export financing scheme (EFS) on semi-finished and finished goods, implementing a balanced tariff structure on raw materials, duty free on intermediate goods and fostering export-oriented industrial clusters. In parallel, he said, advancing the IT sector must be a strategic focus. It is imperative to address the growing trend of IT businesses operating via digital platforms under foreign identities, which leads to foreign exchange losses. Copyright Business Recorder, 2025
Business Recorder
05-06-2025
- Business
- Business Recorder
Tola suggests MAT via CVT
LAHORE: Taxonomist Ashfaq Yousuf Tola has suggested introduction of Minimum Asset Tax (MAT) via Capital Value Tax (CVT) and modernization of the definition of 'Resident Individual' for tax purposes to broaden the tax base and ensure equity within the tax system. To ensure high-net-worth individuals contribute a fair share to national revenue, he has proposed to introduce MAT by expanding the scope of Capital Value Tax CVT. He said the MAT would apply to resident individuals whose domestic assets exceed PKR 100 million and the tax would be charged at 1% of the fair market value of the assets exceeding this threshold. According to him, MAT would be adjustable against the individual's income tax liability, serving as a minimum threshold for direct taxation rather than imposing an extra tax burden. Regarding modernization of the definition of 'Resident Individual' for tax purposes, he said the current residency definition under Section 82 of the Income Tax Ordinance. 2001, which classifies a resident as someone spending 183 days or more in Pakistan, is outdated and lacks alignment with more nuanced residency rules in other jurisdictions. Tola has proposed a revised framework, saying that a more appropriate definition of residency would classify individuals as a 'resident' if they stay in Pakistan for 182 days or more during a financial year. For individuals who stay between 120 and 181 days, he said, their residency status should depend on both citizenship and income. Specifically, Tola pointed out, a Pakistani citizen (as defined under the Pakistan Citizenship Act, 1951) or a person holding a Pakistan Origin Card (POC) who earns income exceeding a prescribed threshold (excluding foreign-sourced income), and has no tax liability in any other country, should be treated as a Resident but Not Ordinarily Resident (RNOR). Those who do not meet these criteria should be classified as non-residents, he stressed. Also, he said, individuals who spend less than 120 days in Pakistan during the financial year should be treated as Non-Residents, regardless of their income or nationality. Copyright Business Recorder, 2025
