Economic vision: MQM unveils Altaf Hussain’s financial proposals

Calls for broadening tax base, pledges shadow budgets.

KARACHI:

Calling for taxing “all taxable incomes” by broadening the tax base without raising tariffs, the Muttahida Qaumi Movement (MQM) issued a paper on Saturday titled “Altaf Hussain’s Economic Vision” along with guidelines for the Federal Budget 2012-13.

Addressing a ceremony at the Karachi Chamber of Commerce and Industry (KCCI), MQM MNA and Minister for Overseas Pakistanis Dr Farooq Sattar said that the share of indirect taxes in the total revenue collection would be reduced from 68% to 60% under the MQM leader’s economic vision.

“Real sovereignty can only be achieved by developing a strong economy, which can’t be built on heavy indirect taxation” Sattar said.

Budget proposals prepared by MQM’s economic team include a reduction in the sales tax rate from 16% to 12%. The proposal also calls for a decrease in the maximum import duties to 10% with the minimum limit of 5%.

The MQM is in favour of the abolition of the petroleum levy which, according to Sattar, has made the life of ordinary people miserable.

There were clear signs of resentment in the KCCI auditorium against Punjab’s politicians, who have been terming the allocation of energy resources biased towards Sindh. Former KCCI president Siraj Kassim Teli was particularly critical in this regard.

“If you want the distribution of resources on the basis of your 62% share in the country’s population, then you should also pay taxes according to the same criterion,” he told the audience.

It will be the first time in Pakistan’s history that a political party is going to release shadow provincial and federal budgets, Sattar said about the MQM’s upcoming shadow budgets.

“I’m going to hold meetings with your different committee members to reconcile any differences between your and Altaf Bhai’s economic visions,” he told KCCI office bearers present on the occasion.

The MQM’s economic vision calls for curtailing the maximum landholding limit and absentee land landlordism besides promising to abolish support prices in the agriculture sector.

Sattar said the top priority should be the energy sector. “The MQM will ensure that subsidies remain for the next few years until we become self-sufficient in energy.”

The MQM supports the provision in tax laws, which calls for computerised national identity card numbers of the customers of every manufacturer, importer and exporter along with bank account trails.

“This measure is presently non-implementable, but it’ll be pursued... and implemented over a period of two years.”

According to the economic vision, imports are subject to taxation unfairly under import duties, sales tax, income tax, withholding tax and value-added tax at the import stage, which leads to increased smuggling and under-invoicing.

Published in The Express Tribune, May 13^th, 2012.