How smuggling effects VAT collection and implementation?
Smuggling is inimical to all kinds of tax systems. However, VAT has several such self- regulatory mechanisms which makes VAT an anti-smuggling measure on its own. The several privileges available under VAT compliance carry an in-built strength to create disincentives against smuggling. Moreover, proper VAT implementation plan is always accompanied by an effective anti-smuggling campaign. FBR is also working out a strong anti-smuggling strategy. Application of broad-based VAT on goods and services across the board upto retail stage level, itself discourages irregular investments like those
in smuggling.
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