US Secretary of State has reiterated her earlier remarks that Pakistan must boost taxes on the wealthy and reduce its reliance on foreign aid to recover from the devastating floods.
After meeting the European Union Foreign Policy Chief Catherine Ashton in Brussels, Hillary Clinton said Pakistan should make necessary reforms to increase its tax collection. She said Pakistan’s wealthy needed to dig into their own pockets to match international efforts to aid the flood-ravaged nation’s long-term recovery.
“The most important step that Pakistan can take is to pass meaningful reforms that can expand its tax base,” Clinton said while talking to reporters in Brussels after the meeting . “I know how difficult it is, but it is absolutely unacceptable for those with means in Pakistan not to be doing their fair share to help their own people.” She said Pakistan must urgently mobilise its own resources and the international community can only do so much.
Clinton also urged the government to take measures to alleviate the power shortages that stifle the country's economic growth while making life difficult for its people.
The EU’s Ashton is expected to chair an international meeting to discuss support for Pakistan in Brussels on Friday.
Last month Clinton came out hard against Pakistan when she warned the flood-ravaged country to make its rich pay. Speaking at the US Global Leadership Coalition conference, Clinton had said: “This is one of my pet peeves: Countries that will not tax their elite who expect us to come in and help them serve their people are just not going to get the kind of help from us that historically they may have."
“Pakistan cannot have a tax rate of 9 per cent of GDP when land owners and all the other elites do not pay anything or pay so little it’s laughable. And then when there’s a problem everybody expects the US and others to come in and help,” she had said.
Finance Minister Abdul Hafeez Sheikh had previously accused the elite class of hampering the broadening of tax net, adding that they were resisting the imposition of the much-needed flood tax.
The government's proposal for the imposition of flood tax has triggered much debate.
The government’s decision however has been criticised as “little more than a case of loading a greater burden on the proverbial camel that is the miniscule tax-paying class of Pakistan.” Proposals have come forth for the government to prioritise its efforts at widening the tax base.
Qureshi in Europe
Tax however was not among a myriad of questions put to Pakistan’s Foreign Minister Shah Mahmood Qureshi during a 90-minute grilling before the European Parliament’s foreign affairs committee.
Qureshi, asked to answer questions ranging from the use of flood aid relief to empowering women and Pakistan’s nuclear intentions, was in Brussels ahead of a key meeting Friday that he co-hosts with Ashton.
Calling for further support from Europe at the 27-nation bloc’s parliament, Qureshi hammered home a message that Islamabad’s fledgling democracy was on the march after ending a decade of military rule in 2008. “We are building a democratic culture,” said Qureshi in response to queries on the role of the military and the power of civilian authorities.
“Without your help I wouldn’t be here, but obviously it takes time. Old habits die hard,” he added. “We have to be persistent and you have to be patient.”
Washington will be represented at Friday’s Friends of Democratic Pakistan ministerial meeting by US envoy for Afghanistan and Pakistan, Richard Holbrooke. Also due to attend is Iran’s Foreign Minister Manouchehr Mottaki.
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