Introduction

What is Tax-toGDP ratio?

Reasons for Low Tax

to GDP ratio in
Narrow Tax Base
Pakistan
Complex Laws
Trust deficit between the Public and
Government
Significant size of undocumented
Economy
Cumbersome tax filing procedure

Reasons for Low Tax to

GDP ratio in Pakistan
Political Instability
Frequent Change in policies
Negative effect of performance in the economy

Low Literacy Rate

Low literacy rate also harm the development of country that
can also harm the GDP

Reasons for Low Tax

to GDP ratio in
Pakistan
Energy
Crisis

Energy crisis has badly affected the economic activities, loosing

revenue due to low production. Company earn less and hence
they pay low tax.

Agriculture Sector

Agriculture Sector plays an important role in a countrys

economy. It contributes major portion of tax in GDP of the
country.

Tax Evasion

Evade the taxes by the illegal means. Taxpayers deliberately

reduce their tax liabilities

Reasons for Low Tax

to GDP ratio in
Pakistan
Tax Avoidance
Legal act of minimizing taxes. Modifying ones
financial situation in order to lower the amount
of his tax liability

How to Overcome the low Tax-toGDP ratio

Tax Revenue and Agriculture
Taxing the agriculture income of the
countrys landlords will provide a significant
boost to the tax revenue

Tax Revenue and External Trade

More exports and imports will result in
higher tax revenue

Literacy Rate
Countrys Economy is dependent on
Education. Increase budgets for education.

How to Overcome the

low tax-to-GDP ratio?
Poverty and High Crime
Unemployment increases due to high taxes
Individuals are unable to support their families, resulting in a
rise in the crime rate

Energy Crises
Take steps to overcome energy crises like increase
production capacity, reducing consumption of products

Conclusion

Thank you