RGST obstacles


That the government is forced to seek a three months extension for getting the RGST bill through is an indication of its failure to carry its coalition partners along. There can be no two opinions that the country badly needs a documented economy. Further that it has got to raise the currently abysmal tax-to-GDP ratio by expanding the tax net, particularly bringing incomes from agriculture, real estate transactions and stock exchange dealings under its purview. For this, the government has to have the will to persuade the legislative bodies, both federal and provincial. As things stand, it does not have even the support of the MQM and JUI(F) over the issue. Recently, the government had tried to woo the PML(Q) hoping to pass the bill with its help. Initially, there were signs of the Chaudhrys willingness to bail out the government. But when the crux of the matter came up, the PML(Q) somehow failed to oblige.

The belated attempt by the Finance Minister to take the PML(N) leadership on board has not met with success. Had the government managed to come to terms with the PML(N), particularly on the issue of passing the anti-corruption law that has remained on the agenda of the National Assembly for the last two years, it would not be facing some of the problems encountered by it now.

There is little possibility of the IMF agreeing to release the next tranche of assistance unless the RGST bill is passed by the legislative assemblies. What strategy the government has in mind to get it through is still not clear. Meanwhile, stories of mega corruption by people in high places continue to appear in the media, the latest being the allotment of a 26.5-kanal plot in the Diplomatic Enclave to Hamid Yar Hiraj who has recently been appointed chairman of the Earthquake Rehabilitation and Reconstruction Authority (ERRA). The allotment, it is maintained, has been made in total violation of rules and regulations and at a scandalously low price. Stories of the type confirm the widely held perception that while the middle class is made to pay taxes, politicians who contribute little to the national kitty, are amassing wealth through illegal meas. Unless there is a comprehensive and strong anti-corruption law in place, stories of the type will continue to appear, acting as disincentive to tax-payers.