THE ECP has announced that General Elections will be held in the last week of January 2024 and hopefully citizens of Pakistan will cast their votes to elect those who have a blueprint to address economic ills that afflict Pakistan. Citizens must judge them on their past performance and not allow themselves to be fooled by slogans. Those held power failed to put our economy on track, when they had the opportunity. They were all part of the system which has failed to deliver. Where else in the world do judges of superior judiciary, like former CJ Gulzar, leave the country immediately after retirement, to live in countries whose immigration they had sought.
How can those who are not willing to wed the future of their families, with fate of Pakistan, be trusted to decide the destiny of 230Million citizens of Pakistan. Every year millions are added to those who live below the poverty line, earning less than $3.5 per day. This increase continued after 2018 and as of 2022 almost 40% i.e., approximately 90 million live in poverty, surviving on bare minimum.
As compared to this, thousands have gone from Rags to Riches, almost overnight, living in houses spread over acres, which were regularized when they held power. Education and Health sectors have been ignored. In such a system, the political elite, out of power or favor, have been victims of political harassment, just like their adversaries suffered. It has become a viscous cycle for which they must share the blame. However, the powerful paid who were involved in manipulations and political engineering etc., apart from amassing fortunes beyond their declared sources of income have never been held accountable.
For the likes of MNS, AZ, IK, Chaudhry clan of Gujrat etc., who may have endured harassment and victimization, they must understand it is miniscule compared to the sufferings endured by the hapless 230million citizens of this country. It is time for people of Pakistan to finally realize that they have suffered enough and should no longer be swayed by those who exploit religion, sow seeds of discord, promising them the moon, but when in power made no substantive headway to provide relief to them. The whole world seems to be aware, including the MD IMF, who has again told the Caretaker PM, what other financial institutions and our own economists of repute and integrity have stated, what is the obvious cause for economic chaos and quagmire engulfing this country.
Kristalina Georgieva the MD of IMF talking informally to Caretaker PM stated that “What we are asking in our programme is that please collect more taxes from the wealthy and please protect the poor people of Pakistan”. She further elaborated that “I do believe this is in line with what people in Pakistan would like to see for their country”. How, blunter could she be. Whilst the Caretaker PM cannot be blamed for economic chaos that Pakistan faces, others cannot be excused, including former PDM coalition PM Shahbaz and PM Imran Khan who held power and others who preceded them, starting from 1958 onwards. Former Finance Minister Dar stood on the floor of NA and stated that under no circumstances he would allow taxation due on real estate, big landlords etc.
They all facilitated and ensured that tax reliefs, amnesty schemes and subsidies continue for Real Estate cartels where the black undocumented economy is parked, and the Retail/Wholesale sector, nor any Sin Tax on Tobacco and all other cartels. No one has made any effort to curtail smuggling of essential food items by truckloads on our western borders, which has been going on for decades. Every government at helm has continued to facilitate the Capacity payment PPA agreements and even extending them. There can be no justification for allowing more than required number of IPP units, whose combined capacity exceeds total electricity consumption requirements, even exceeding the capacity limitations of transmission of electricity. Similar is the situation with excess number of sugar mills that have been allowed to be set up, far exceeding our domestic consumption. While excess sugar produced can be exported to earn much needed foreign exchange, the same cannot be done for excess electricity.
The IMF will certainly have no objection, if indirect taxation levied on utilities like electricity, gas bills etc. are withdrawn, as long as Pakistan can raise enough revenues through direct taxation. All stakeholders, including politicians and establishment know, that unless the State has fiscal space, with enough revenues derived from direct taxation, there cannot be any space for relief, by waiving indirect taxes levied on electricity bills, prices of essential items, nor can the state subsidize education and health etc. The IMF cannot and should not be blamed for sufferings of the poor, who bear the burden of indirect taxation. For decades, all those who have held power, facilitated tax relief to big landlords, real estate sector, tobacco, retail and wholesale traders etc. Relief to the poor can only be provided if those holding power are willing to increase taxes on the cartels that have for decades enjoyed tax relief.
Just 2% increase in tax on all these sectors, would be enough to offset the shortfall in revenues from indirect taxation etc. and bridge the widening budget deficit. Curtailing smuggling of essential items like sugar, wheat, fertilizers, including foreign exchange to Afghanistan across our western borders would provide enough stocks to meet domestic demand of these items, and control price escalation. Excess produce should be exported to earn foreign exchange or through barter trade. It is time for this country to understand that priority should be welfare of citizens of Pakistan. Every government including PPP, PMLN, PTI, PMLQ, Musharraf etc. was involved in facilitating these cartels in tax evasion, smuggling etc., when they were in power. All that the IMF is asking is how will the Federal Government fill the shortfall by reduction in indirect taxes on basic essential items. Merely talking about providing relief is just fooling the people.
—The writer is contributing columnist, based in Lahore.
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