This is with reference to reported excuse of Dr Hafeez Shaikh in Washington that our parliament is an obstruction to tax reforms in Pakistan. It is an unfortunate reality that this parliament, all previous military or civil governments and technocrats have opposed tax reforms and collection to benefit the rich elite, be they landed feudals, traders, industrialists, stock exchange brokers or real estate investors. As a consequence this, country’s middle class and poor class end up paying indirect taxes, thereby widening the ever increasing Tax-to-GDP ratio, which has led to dangerous rise in inflation, poverty, suicides, street crimes, fanaticism and extremism. This institutionalised evasion of tax by the elite of this country today poses the biggest threat to our national security. Loopholes in rules facilitate flight of capital and an ever-increasing black economy.
The state of Pakistan has failed in its primary duty to invest in human resource development through provision of free or subsidised quality education, health and justice to every section of the society, especially the poor and under-privileged. Even religion has been exploited to evade taxes on betting, alcohol consumption etc, although these activities are subscribed to by a large section of our population.
Politics in Pakistan has become slave to those who have amassed wealth through illegal sources, corruption, drugs or loan defaults. It is for the state to tax all sources of revenues, so that it can discharge its obligation for welfare of the people if it wants to strengthen and enforce rule of law. In any case those who earn above a certain threshold, but don’t pay taxes, should have no right to represent the people, or be eligible to stand for elections. The situation is so bad and embarrassing that even foreign dignitaries, especially those belonging to donor countries have started openly rebuking the government for failure to tax the rich.
It is ironical that Mr Hafeez Shaikh is himself a beneficiary of this deformed tax structure, where agriculture income is not taxed. Those who don’t pay taxes in Pakistan have no disadvantages whereas those who have paid their taxes honestly have no extra privileges. The latest ordinance to impose additional taxes does not spare even those senior citizens who have invested their life long savings in Regular Income Certificates scheme which were introduced to help widows and pensioners, but has cunningly spared the corporate sector from this surcharge.
MALIK TARIQ ALI
Lahore
