KARACHI:
The International Monetary Fund (IMF) package and other loans will provide Pakistan with just enough breathing space to set our house in order and adopt economic policies to bridge this ever-widening gap between state revenues and expenditures. However, for long-term economic recovery, the state must impose a tax on all sources of income above a certain threshold and cut down imports of all non-essential luxury items. The state must also adopt austerity measures. Instead of withdrawing taxes on the retail and wholesale sectors, regulations must be tightened to prevent retailers and wholesalers from hoarding and black marketing.
The former government announced tax relief for the import of luxury electric limousines in a country where there is an acute shortage of electricity. Currently, most parts of the country are faced with frequent load shedding with electricity bills reaching an extortionate level.
Pakistan’s agriculture-based economy, which was once self-sufficient is now facing an acute crisis. Today we are forced to import expensive food items. For the past several years, the government has allowed the real estate sector to convert fertile agricultural land and fruit orchards into concrete jungles. This is not only affecting our ability to produce food, but the sector pays minimal taxes on the sale of these properties. Our elites are still flying on private executive jets instead of commercial flights. The austerity needs to start at the top before burdening the masses with indirect taxes. Otherwise, we will continue experiencing economic upheavals.
Malik Tariq Ali
Lahore
Published in The Express Tribune, August 24th, 2022.
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