No more taxes

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STATEMENTS emanating from senior officials and reliable sources convey a clear message that the Government was preparing grounds for imposition of more taxes and that too on those who are already contributing their share to the national kitty.

Talking to media, Finance Minister Miftah Ismail did not contradict such reports and made diplomatic remarks that no decision has yet been taken to impose taxes through an ordinance for additional revenue generation and a decision has to be taken by the Prime Minister.

In a related development, the Government has confirmed to the International Monetary Fund (IMF) that the petroleum levy would be increased to Rs 50 a litre in a staggered manner and that the levy would go up by Rs 10 from next month (September).

It is regrettable that the process of revision of the original budgetary proposals (for the current financial year), which started with the accommodation of several demands of the IMF in the Finance Bill, continues to date on different pretexts but the net result of all these measures is addition of difficulties of the common man.

The reports about a mini budget are unfortunate as this is aimed at bridging the fiscal gap that occurred after waiving off different tax incentives offered to powerful lobbies such as traders, bankers and others.

The government is facing revenue loss of Rs15 billion after waiving off fixed tax collected from small traders through electricity bills.

As against the original budgetary target of Rs 42 billion tax collection from traders it would now be able to collect Rs.27 billion as fixed tax scheme has been shelved at the behest of the senior leadership of the PML(N).

Together with income tax relief for banks and a plan to raise Rs 30 billion for the state-owned Pakistan State Oil (PSO) the mini budget would mean taxing the poor to support white elephants and powerful lobbies that get a variety of incentives but are not willing to pay taxes.

At the same time, people were denied benefit of reduced prices of oil in the international market and appreciation of the rupee against the dollar in the latest fortnightly review and they are unlikely to get any relief on this account due to commitment with the IMF to jack up petroleum levy every month till April 2023.

The Government, no doubt, has its own constraints but it should not take decisions and make commitments that are detached from the ground realities.

People displayed their resentment against one-eyed policies of the Government during by-elections in Punjab and continued insensitivity towards the plight of the people would produce no different results in future.

It also seems the Government is tacitly approving depreciation of rupee as the State Bank allowed export of dollar at a time when rupee was appreciating on a daily basis and the move not only halted but reversed the process as the rupee lost its value against the dollar the very next day of the questionable decision.

This also amounts to depriving people of the benefits of exchange rate stability.

 

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