Taxes are imposed to generate revenue, but there are many other ways to do it
KARACHI: In the midst of unaffordable tax rates and an economic recession, lower-income groups are facing issues related to the taxes imposed by the government. I do not see anyone who is satisfied with the steps taken to collect taxes from the general public. Higher-income groups have a lot more income to bear these taxes but the lower-income group barely has the income to cover up their daily expenses which are increasing by the day and the reason being increased taxes. In order to ensure the repayment of their loan to Pakistan, and to somehow show some sort of economic stability on paper, the imposition of taxes was one of the preconditions for the IMF loan. It is difficult to comprehend how an organization sitting thousands of miles away can implement a universalised system in different countries.
The tax rate has been increased drastically as compared to our wages and incomes. The condition is such that savings have gone down the drain. Increase in the prices of daily life commodities has resulted in inflation which is causing more and more problems for the middle class.
Taxes are imposed to generate revenue, but there are many other ways to do it. My suggestion is to take a few steps like increasing investments in export products so that sufficient revenue is generated, increase wages, follow progressive tax system, discourage the import of unnecessary and luxury items such as luxury vehicles, stabilise the general price level by imposing a fair amount of tax according to our income groups and make investments in the productive sectors.
Talal Sheikh
Published in The Express Tribune, September 4th, 2019.
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