The government will keep punishing people for its own shortcomings, as it has assured the International Monetary Fund (IMF) that it will introduce more mini-budgets to offset any possible shortfall in tax revenues. It will also increase power tariffs if the Supreme Court strikes down electricity surcharges.Finance Minister Ishaq Dar gave the written assurances in a letter to the IMF on June 12. According to the Memorandum of Economic and Financial Policies (MEFP), “If tax revenue falls below the level envisaged in the programme, the authorities will implement additional revenue measures, including plans to eliminate tax concessions and exemptions slated for fiscal year 2016-17.”This basically amounts to punishing taxpaying citizens for the government’s own incompetence through imposing mini-budgets. In the past, these have hardly ever achieved the desired results, but clearly no lessons have been learnt.In the budget, the government has tried penalising those who don’t file their tax returns. But this reward-punishment strategy will not work. The fault lies in the manner the tax returns are supposed to be filed and the public’s avoidance of the same. However, this area continues to be ignored and instead there is reliance on mini-budgets to compensate for the shortcomings of the country’s tax machinery. It seems that the only way the authorities might be pushed into instituting substantial tax reforms is if the IMF insists on this being done.
pk.shafaqna.com
