Budget for the next fiscal year 2019-2020 is around the corner, to be announced on June 11, 2019. Due to extreme economic crisis and harsh conditionalities agreed with the International Monetary Fund (IMF) in lieu of a bailout package of US$ 6 billion, the Government has already announced that “it will not be in a position to offer any big relief” as new taxes are inevitable for fiscal stabilization. It is lamentable that despite this justification and/or excuse, funds for the comfort and luxuries of the privileged classes-army of ministers, state ministers, advisers, members of militro-judicial-civil complex and politicians in parliaments-are available. For them principle of equal sacrifice does not apply in the Land of Pure! Strangely, in the circumstances requiring resource mobilisation to contain burgeoning fiscal deficit exceeding Rs, 2500 billion, there is no will to cut down wasteful expenditure of billions of rupees and impose progressive taxes on the ultra-rich and those who get state land as reward and awards. There is no intention on the part of the Government that won the elections on the slogans of providing social justice to collect agricultural income tax from the absentee landlords, mostly sitting in the National and Provincial Assemblies and also having dominant role in Pakistan Tahreek-i-Insaf (PTI). There are no plans to impose excess profit tax on those making extraordinary profits by fleecing the masses and establishing business cartels. Many of them are sitting as ministers or enjoying status of minister as advisers in the coalition PTI Government. It is a disturbing reality that while rich and mighty are not adhering to austerity, the vast majority having fixed incomes-salaried class and millions living below the poverty line is facing extreme economic hardships due to mounting inflation after devaluation and rise of prices of items of common use and higher cost of utility bills-just to mention a few. Adding insult to injury they are bearing the burden of exorbitant sales tax of 17% and in many cases over 45% after adding other taxes. An attempt is made here to make a case for hard-pressed classes having meagre incomes for a favourable tax regime with the hope that budget makers would pay heed to it. Those contributing towards economic growth and social development should not be made to suffer because of regressive and unjust tax measures, as the genius in tax field, Nani Palkhiwala said in his book, We the Nation, ‘the budget is a harbinger of good times to come’ Educational expenses: The low-income groups are compelled to spend sizeable amounts from their limited resources on the educational needs of their children (which primarily is the duty of the State under Article 25A of the Constitution). This portrays the apathy of governments-federal and provincial. While unprecedented tax breaks, benefits and amnesties have been extended to the wealthier echelons of society, the low-income groups have not been allowed to enjoy tax exemption on the entire amount of educational expenses. The Government in the coming budget should allow them and also give tax incentives for educational investments by industrial houses so that they can make their workers skilled and educated. Educational expenses up to some reasonable limit per child should be tax free. If industries establish vocational training institutes for employees, they should be allowed to deduct expenses to run these against taxable income. Medical expenses Health is another important area that needs to be promoted through tax incentives. At present, free provision to the employee of medical treatment or hospitalization or both by an employer or the reimbursement received by the employee of the medical charges or hospital charges or both paid by him, where such provision or reimbursement is in accordance with the terms of employment is tax free [provided that National Tax Number of the hospital or clinic is given and the employer also certifies and attests the medical or hospital bills]. Alternately, any medical allowance received by an employee not exceeding ten per cent of the basic salary of the employee if free medical treatment or hospitalization or reimbursement of medical or hospitalization charges is not provided for in the terms of employment is tax exempt. However, if an employee spends more than these fixed limits he has to pay tax on it, which is highly unjust. This position needs to be rectified. Medical expenditure should not be treated as a perquisite as it is not something in the nature of fixed benefit or amenity periodically accruing from the employer to the employee. The employers should be encouraged through tax benefits to extend medical facilities to their employees and their dependents. Such expenditure should neither be treated as perquisite nor as taxable receipt in the hands of the employees. Conveyance allowance: Conveyance allowance or provision of providing such facility by employer to low-income salaried employees should be tax free. Salaried persons incur substantial amount out of their pay on travel to and from office. There should not be any limit for tax-free conveyance allowance or benefit provided by way of vehicle by employer along with its running and maintenance for employees earning salary up to Rs. 100,000 per month. For employee earning higher salary taxation should not be more that 5% of allowance or benefit provided in kind. Threshold limit: Salaried individual should not be taxed unduly as they cannot claim any kind of expenditure against their pay, though they expend some part of it purely for employment purposes. In their case minimum taxable threshold should be more than other persons who can claim a host of tax deductible amounts. They should not be taxed up to gross taxable salary of Rs. 1,500.000 and tax slabs in their case should be as under: 1. Rs. 1,500,001 to Rs. 2,500,000 5% 2. Rs. 2,500,001 to Rs. 5,000,000 15% 3. Rs. 5,000,001 and above 25% The salaried class and low-income groups deserve a far better tax treatment than what is presently meted out. They should be given tax relief for expenditure incurred on their children’s education and health care of family members. These facilities are the responsibility of the State but in Pakistan (and we call it Islamic Republic!) the masses are forced to expend from their meager incomes. For the contribution skilled/salaried persons make to the society, their income should be taxed rationally and in no way should it be to their disadvantage. We know the rich trading class contributes only 1% in sales tax and 0.5% in income tax! Oppressive taxation of salaried class is hampering growth of financial, industrial and service sectors where specialization is the call of the hour. For example in IT industry any highly paid software engineer, capable of bringing enormous foreign exchange for the country, would be discouraged to work in Pakistan merely for unjust tax burden. There is an urgent need to rationalize taxation. Those contributing towards economic growth and social development should not be made to suffer because of regressive and unjust tax measures, as the genius in tax field, Nani Palkhiwala said in his book, We the Nation, ‘the budget is a harbinger of good times to come’. Let us hope that budget 2019 will address at least some key issues pointed above to provide much-needed relief to hard-pressed, low-income groups. The writer, Advocate Supreme Court, is visiting faculty at Lahore University of Management Sciences (LUMS)