ADVISOR to Prime Minister on Finance and Revenue Dr Abdul Hafeez Sheikh, who is known for straight talk, has presented a positive picture of the present state of economy in the backdrop of growing concerns being expressed both by different segments of Pakistani society and bilateral and international donors. The information, facts, figures and data shared by him, along with Chairman Federal Board of Revenue (FBR) Shabbar Zaidi and Secretary Finance Naveed Kamran Baloch, on Sunday would surely help restore confidence of the people as well as investors.
The strategy of the Government, as explained by the Advisor, that the tax revenues would be maximized, expenditure reduced, non-tax revenue increased and finally the macro-economic stability would promote growth and enhance economic activities yielding increased tax collection seem to be working as highlighted by several economic indicators. According to him, Pakistan is fast heading towards economic stability as the Government is expected to collect up to Rs. 1,000 billion in no-tax revenue by December next year, which might translate into some breathing space for the Government as well as tax-ridden masses. It is also reassuring that the Government and especially the Advisor and the FBR Chairman are showing no flexibility or leniency as far as increase in tax collection is concerned that offers the long-term and sustainable solution to economic woes of the country. However, as we have repeatedly been pleading in these columns, levy of simplified tax regime for business community would be the real test of the Government’s resolve to document the economy and made all tax evaders to pay, at least partially of what they actually earn. Indications of growth in exports and about 73% reduction in current account deficit are also laudable developments but there is dire need to diversify exports and provide due incentives to local industry to produce surplus for the purpose. The desire of the Advisor that the accountability process should progress in such a manner as does not negatively affect the business climate also needs urgent attention by all stakeholders if we are genuinely interested to pull the country out of the existing messy situation. One would, however, not agree to the idea of privatizing profitable institutions like National Bank and State Life Insurance. The most viable option would be to reform and restructure them to achieve still better results.
