he Finance Bill 2025-26 appears to be the most confusing document that any government has produced in years. It revolves around going after the economy of the youth and the 21st Century business practice.”

---- Anti-digital, pro-realty sector budget, The Express Tribune, June 11, 2025.

The Finance Bill 2025, presented along with the federal budget for the fiscal year 2025, announced on June 10, sows tax policy at its worst. Bent apparently upon destroying businesses and the economic life of millions of hapless citizens, our economic and tax managers have proposed tax measures in utter violation of the inalienable fundamental rights guaranteed under the constitution.

The most obnoxious of these provisions were first promulgated through The Tax Laws (Amendment) Bill, 2024, tabled in the National Assembly by Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb, on December 18 last year, but were blocked by the relevant standing committee. These have now been proposed in the Finance Bill as amendments to the Income Tax Ordinance, 2001, and Sales Tax Act, 1990. These amendments impose restrictions on the citizens’ right to acquire and dispose of property in Pakistan and the freedom of doing business. How can provisions lacking constitutional validity in terms of Articles 4, 8, 14, 18, 23, 25 of the supreme law of the land be proposed again under the garb of a money bill?

Budgets proposed by civilian as well as military-led governments have often focused mainly on taxation rather than a vision of welfare programmes to help those lagging behind in the society and enabling them to move up economically and socially. Budgets produced in welfare states ensure redistribution of wealth and income so that everyone can meet their fundamental needs. In our country, however, pro-rich tax policies and elitist structures of the economy seek to provide unprecedented opportunities to the rich to amass more wealth. This year’s budget is no exception. The tax expenditure, as per the official data for the fiscal year ending on June 30, 2024, was Rs 5,840.2 billion.

Budgeting should not be just a book-keeping exercise. It should reflect the socio-politico-economic policies of a government. Since being elected prime minister for the second time, Shahbaz Sharif has paid no attention to structural reform of the administrative apparatuses or the dismantling of elitist structures. How can a finance minister in Pakistan ignore the fact that 90 million women in the country remain illiterate; 30 million children remain out of school; 60 million are undernourished and over 80 million live below the poverty line.

Everybody, it seems, loves to quote figures about fiscal deficit, public debt and debt servicing, government expenditure, exports, trade deficit, foreign exchange reserves, indirect taxes and the rising cost of living, but is not interested in talking about equitable growth, jobs and decent wages for all.

There is no debate on any TV channel about Article 3 of the constitution as a cornerstone of our economic policy. It says: The State shall ensure the elimination of all forms of exploitation and the gradual fulfilment of the fundamental principle, from each according to his ability to each according to his work.

Budget 2025-2026 is nowhere close to fulfilling the promise made in Article 3 of the constitution. The elites, over-represented in the legislative assemblies, have forged an unholy alliance against the common man. These elites openly indulge in vulgar ostentation and flout the rule of law. The poor are often denied even the promised minimum wage.

Our governments are totally oblivious to redistributive fiscal policies and programmes for increasing social mobility.

A friend of mine recently came up with a challenge: “Outline an ideal budget for Pakistan.” The answer is really very simple: its short- as well as long-term goals should deal justly with all economic classes in the society and it should promote social mobility.

Why should we waste precious man-hours quoting from and trying to analyse figures and indices presented every year as “budget documents”? The Finance Bill seeks as usual to protect the rich and mighty and increase the incidence of tax on the middle class and the poor— under the pretext of conditions agreed with the International Monetary Fund. The IMF chief had once said publicly: “We want Pakistan to tax the rich.” What we need is a new policy framework for our budgets that seeks to ensure prosperity for all and not for the privileged alone. There is no need to dispute the statistics presented by Muhammad Aurangzeb et al. Let us instead discuss what they did not address and should have done.

Pakistan’s economy works for the privileged classes. Representing less than 1 percent of its population, they enjoy perquisites and benefits at the expense of taxpayers’ money. Mighty landowners exploit the labour of landless tillers and unscrupulous industrialists and traders exploit the poor urban workers to amass great wealth. They also initiate artificial price hikes to steal from the poor and the fixed-income classes.

In 2006, The Economist (May 27-June 2) published two studies showing how the Nordic countries had achieved social mobility and economic justice by taxing the rich to raise money for a welfare state. These countries “help the children of the poor to do better than their parents.”

Of course, redistributive fiscal policies alone cannot bring about the desired results (the welfare states in the Nordic countries are not appreciably more generous than Britain’s). One explanation for their success is their superior education systems. Education has long been recognised as the most important single trigger of social mobility. All four Nordic countries do unusually well in school appraisals.

Despite the insertion of Article 25-A in the constitution, our budget makers at the federal and provincial levels, have failed to establish education systems that can uplift those at the bottom. While the constitution guarantees the fundamental right to “free and compulsory education to all children of the age of five to sixteen years,” private education remains an exploitative industry—expensive, often low-quality and class-ridden. The economic policies of the federal and provincial governments in the perspective of Articles 3 and 25-A are simply loathsome.

Our governments are oblivious to redistributive fiscal policies and social welfare programmes for social mobility. The poor are given the so-called “economic relief package” by way of charity. The ‘relief’ is of cosmetic nature and there is nothing in the policies or budget to help the poor move upward.

Both federal and provincial governments must realise that what matters is not only spending more money on education but also how the education system can be an effective tool for social mobility. There is a complete lack of understanding of this perception on their part. The result is that the poor are forever condemned to abject poverty and their children stand little chance to grow out of it as education is either not accessible or is of no practical use.

Budget 2025 is yet another exercise of balancing the books (allegedly, by window dressing). Pakistan needs meaningful redistribution policies that can uplift the downtrodden. There is nothing in this budget towards that goal; it is an utterly disappointing document.

The writer is an advocate of the Supreme Court, an adjunct teacher at the Lahore University of Management Sciences and a member of the Advisory Board and a visiting senior fellow at the Pakistan Institute of Development Economics. He holds an LLD in tax laws and was full-time journalist from 1979 to 1984. He also served in the Civil Services of Pakistan from 1984 to 1996