Elite nation

The pressure by international financial institutions like the IMF, ADB etc is that states which take loans from them must collect enough revenue to be in a position to pay back debt. It is not the concern of these IFIs about the recipient state’s tax criteria. Just like banks exercise the law of foreclosure on loan defaulters, these IFIs ensure that in case of default, clauses are inserted where they end up acquiring assets pledged by the state as collateral. In democratic countries, the state levies direct taxes on all citizens who earn above a declared minimum. The revenue from taxes are spent on administration, provision of justice, law and order and all other basic necessities of life, in addition to construction and maintenance of infrastructure, provision of welfare, education and health etc. It is only when the state has exhausted all sources of direct taxation and faces financial constraints to cater for the welfare of the most deprived does it resort to levying indirect taxes on luxury consumer items, ensuring that this does impact the poor and lower middle classes. Every cent of taxpayer money is audited to ensure there is no abuse or wastage. Unfortunately in Pakistan, ever since successive governments in nexus with the elite have adopted a policy to serve elite, the preference is to levy indirect taxes with the sole objective to provide relief for the affluent and promote tax evasion. If we as nation continue to subsidise the extravagant lifestyle of our paid or elected elite – instead of investment in human resources and growth of the manufacturing sector – we are doomed. Negative growth will impact national security and sovereignty.

Ali Malik Tariq

Lahore