The promise of economic recovery, the expansion of the tax net and the sword of inflation
Are the positive results of adopting the strategy set by the Special Investment Facility Council expected to start soon?.
For the past seven decades, due to dependence on external loans to deal with the economic crisis, the debt burden on the nation increased and as a result the economic difficulties continued to increase instead of decreasing, but for the first time in the national history, the political and military leadership of the PDM The government jointly adopted a strategy to bring large-scale foreign investment in the country instead of loans in the form of the Special Investment Facilitation Council, which is expected to start yielding favorable results soon. Caretaker Prime Minister Anwarul Haq Kakar gave this good news in a speech at an event a few days ago. He further said that in the next few weeks, memorandums of understanding will be signed with many countries, as a result of which billions of dollars will be invested in Pakistan in minerals, IT, agriculture and other sectors.
Privatization of institutions that become a burden on the national exchequer has also been a requirement of the situation for some time, but it has proved impossible for the political governments to make progress in this matter, but the caretaker federal government is also taking steps in this direction. According to the Prime Minister, concrete results of these efforts will be revealed in the middle of January. He said that the government's first priority is the privatization of PIA, apart from this, the process of privatization of electricity distribution companies, steel mills and state-owned enterprises is being carried forward on a fast track. The Prime Minister assured. He said the government would take the business community into confidence in the Facilitation Council and there would be good news in a few weeks.
Highlighting the possibilities of a better Pakistan, the Prime Minister said that skilled human capital is the solution to many challenges. A population of 24 crore with a large number of youth under the age of 25 increases the value of human capital, but skilling the youth through targeted training programs is critical. The government has launched a vocational training program for this purpose in which the German company Siemens and other European partners are cooperating. Barriers are being removed to attract investors, ease of doing business is being created. Uzbekistan, Afghanistan and Pakistan will be connected by railway. The Caretaker Prime Minister said that the government is bringing reforms in the country's tax system and building it on modern lines, government expenditure is being reduced.
The Prime Minister said that the positive results of these economic recovery efforts are in front of everyone in the form of the stock market reaching the highest level in the history of the country, i.e. 59 thousand points, but to maintain this situation, bribery, recommendation and Discouraging corruption at all levels, ensuring merit and transparency in all matters and getting rid of traditional red tape is very important.
An extension to Tex net
The government has taken difficult and far-reaching decisions to increase the government revenue by taking measures to increase the tax net and prevent tax evasion in order to restore the country's poor economy, pay off trillions of rupees of debt and implement multi-purpose projects. There has been a significant progress in this. FBR and NADRA will work together in this regard.
An 8-member committee has been set up under the chairmanship of Chairman NADRA Lt. Gen. Muhammad Munir Afsar, which will prepare recommendations and suggestions regarding the implementation of the FBR plan to expand the tax net. The committee will examine the actual income of the taxpayers. Data will also be exchanged. This move is expected to close the avenues of tax evasion. The IMF has also proposed to bring 15 to 2 million new taxpayers into the tax net by June 2024. The imposition of taxes is the compulsion of the government to get rid of the growing foreign debts and to get the country out of economic difficulties.
Experts believe that in the context of 76 years of the country's history, the most damage to the economy was due to the trade imbalance and the weak system of taxes at the internal level. This whole situation gave birth to an illegal parallel economy, but in each era, the need to reform the revenue system and increase the scope of taxpayers was also emphasized. In the financial year 2018, the number of taxpayers increased by 715,000. In the eleven months before June 2023, 11 lakh 61 thousand new taxpayers were added. As of now, only 33% of the tax-paying class is covered by the tax. Instead of increasing the taxes, the tax net should be increased. Simplifying the procedure for paying taxes can also increase the number of taxpayers significantly.
A fresh wave of Inflation
In the country's history, since February 2023, inflation has broken all previous records, during which hardly a month has passed without an increase in the prices of petrol, electricity or gas. This has an immediate impact on transport, freight and commodity prices. In the past few days, due to the fall in petrol prices, stability was seen in the markets, but the impact of the 196% increase in gas prices from this month on industry and trade has made the inflation graph even higher.
According to the data released by the National Institute of Statistics, the inflation rate was recorded at 41.13 percent during the week ending on November 23. After gas, the items that saw the highest price increase were cigarettes 94%, flour 88.2%, ground chilli 81.7%, broken basmati rice 76.6%, garlic 71%, eri 6/9 rice 62.3%, branded tea 53%, jaggery 50.8% and Potatoes (47.9) percent included. Onion prices fell by 36.2 per cent year-on-year, tomato by 18.1 per cent, mustard oil by 4 per cent and ghee by 2.9 per cent. This figure is a continuation of the strong week from last week which saw the price index at 308.90 against 309.9 in the week ended.
According to Trading Economics, Pakistan has come fourth in terms of inflation among Asian countries, while Afghanistan has the lowest rate. On the other hand, the common man's need is not only food, children's education and treatment are also necessary along with life. An average multi-member family is run by a sole breadwinner. The government should prevent further increases in the dollar and energy prices as a measure to quickly end the effects of this life-destroying inflation, thereby stabilizing the meat and fruit and vegetable markets.