Friday December 08, 2023

Reform games

October 24, 2021

Our financial managers are caught in a dilemma. On the one hand, there is a mounting pressure to reduce the fiscal deficit through improved collections and on the other, they are not ready to abolish innumerable tax exemptions and concessions available to the rich. In our fiscal woes, IMF dictation also pressurizes our economic managers to follow their harsh conditions. They insist on regressive taxes and do not care that such actions not only burden the poor but are also in open violation of Articles 77 and 162 of the constitution. In their countries, these people talk about rule of law and in Pakistan they ignore it.

The IMF in its parleys with Pakistan has never raised the issue of unprecedented taxes on basic consumption products. Over time, our tax system has become faulty, oppressive, unjust and target-oriented. We should liberate ourselves from the reform game of the World Bank and other foreign donors. These policies are not making us self-reliant but on the contrary are destroying our industry and businesses. If we manage to formulate a rational tax policy through public debate and parliamentary process, and implement it through consensus and not coercive measures, there is every possibility of becoming self-reliant in a short span of time.

Shafi Ahmed Khowaja