PTI slams govt for imposing super tax

Leaders say decision will push Pakistan further into economic crisis

ISLAMABAD/LAHORE/KARACHI:

The former ruling Pakistan Tehreek-e-Insaf on Friday slammed the coalition government for imposing a 10% super tax on 13 major large-scale industries, saying that the decision would lead to the “closure of industries”, increase unemployment and inflation, shoot up imports and push Pakistan further into economic crisis.

"This is a huge blow to the growing industries," PTI Secretary General Asad Umar said while addressing a news conference in Islamabad.

Earlier in the day, Prime Minister Shehbaz Sharif announced a 10% levy on sectors, including sugar, oil and gas, cement, steel, airlines, fertilisers, LNG terminals, textile, banking, automobile, cigarettes, beverages, and chemicals.

Umar said, “The super tax is an attack on those sectors of the economy that have the potential of growth and can increase production as well as livelihood.”

He termed the budget dangerous and fatal for the economy. For the past 20 years, he said, Pakistan had a policy of gradually decreasing taxes on industries but they (the incumbent government) ruined it all.

He stated that even now, despite increasing prices of every commodity — diesel, petrol, gas, and food items — the PM said the deal with the International Monetary Fund (IMF) will only be signed if the fund doesn't make more demands.

"This is a joke with the public," he said. "And then you ask people to be thankful? Mian sahab, you had a choice between protecting the public and hiding your corruption and you have chosen the latter," the former minister added.

He said that the government did not care about the public as it knew the public did not choose it.
"All they care about are the people who brought them. How will America be happy? Will it be happy by recognising Israel? By extending ties with India or by giving bases [to the US]?"

Industry is already facing crippling costs due to rising prices of commodoties and energy. This super tax will be priced in their balance sheets and passed on to the customers in many cases. Means even higher prices for the public. https://t.co/4op4vlgKg1

— Hammad Azhar (@Hammad_Azhar) June 24, 2022

Responding to the PM's remarks on PTI leading the country towards default, Umar said that when the Imran-led government was "ousted", the foreign exchange reserves in the State Bank were $16.4 billion.

"In the last three months, they have come down exactly by half. So, PM sahab, it was you who has driven the country to default, not us."

Umar said that the PML-N government had presented the "real budget today". He stated that according to the Constitution, when the budget was presented, the Senate had a time of 14 days to debate on it and present its observations and reservations. "But they named the budget presented on June 10 provisional.

Then they let 14 days pass and made an announcement today in which taxes of billions of rupees were imposed. This is a violation of the Senate's constitutional rights," Umar said.

Read IMF lacks trust as PTI govt reneged on pact: PM

He demanded that since the budget was finalised on Friday, the Senate should be given 14 days from today onwards to discuss it. "If this doesn't happen then the budget will become unconstitutional and can be challenged in the courts."

Further, former federal minister and PTI leader Hammad Azhar said that the super tax meant "taxing the already taxed even more", adding that it would "squeeze the formal sector of the economy".

"At a time when the economy is on the decline, such a move will slow down the pace of industrialisation that the PTI generated," he tweeted.

Azhar highlighted that the industry was already facing crippling costs due to rising prices of commodities and energy. "This super tax will be priced in their balance sheets and passed on to the customers in many cases. Means even higher prices for the public."

He also said that 0.63% of taxpayers pay 67% of all income tax collected in the country. "Total Rs60 billion realistically expected from the super tax. Out of this, Rs46 billion will come from banks. Total tax collection target is Rs7,400 billion that will be met by inflation alone. So for a gimmick (like the imports ban), they heavily taxed the already taxed formal sector," he said.

Miftah Mian,with an overseas PhD, should have enabled you to acknowledge your own approved Economic survey which documents stellar PTI performance in the last two https://t.co/uJuVUKm6n1 refuse to accept it as it exposes your https://t.co/xmC7X4duMk does not believe you.

— Shaukat Tarin (@shaukat_tarin) June 24, 2022

Former finance minister Shaukat Tarin, while taking a swipe at the coalition government, said that it talks about taking care of the poor, but its actions show otherwise.

“If they [government] does not announce elections afresh, Pakistan’s state would be similar to that of Sri Lanka,” he said, accusing the new government is lying about the economic situation.

Read more PM promises to release details of PTI-IMF deal

Shedding light on the immediate reaction of the market, he highlighted that the currency once again lost its value while a bloodbath was witnessed at the Pakistan Stock Exchange (PSX).

Later, the former finance minister also took to his Twitter handle to accuse Federal Minister of Finance and Revenue Miftah Ismail of ignoring the “stellar” economic performance during the PTI’s tenure.

“Miftah mian, an overseas PhD should have enabled you to acknowledge your own approved economic survey which documents stellar PTI performance in the last two years,” he wrote.

“You refuse to accept it as it exposes your narrative. [The] market does not believe you,” he added.

Further, former information minister Fawad Chaudhry said that the PSX meltdown showed the amount of confidence the nation had in the Shehbaz-led government.

"The government's economic policies are making Pakistan bankrupt. Getting rid of this government is in Pakistan's best interest," he said.