There was a time, not too long ago when PML-N was last in power and we were in the thick of an IMF program, that the government would always request downward revision of the tax target during quarterly meetings, among other things. And as soon as that happened Imran Khan would call a press conference, place Asad Umar at his side, and attack the government for failing to meet crucial targets. Now they’ll raise taxes and squeeze the people more, PTI leaders would always say. But, quite ironically, PTI is pulling the same stunts now that the shoe is on the other foot.
So, if news reports are to be trusted, the government has asked the Fund to reduce the revenue target; not the least because of the great shortfall in tax collection in the first seven months of the outgoing fiscal – Rs385 billion against targeted Rs2.79 trillion. Now, surely, there is going to be another mini-budget, the third in only 17 months, and word is that additional taxes worth Rs200 billion are on the cards. With inflation still unresponsive to the extremely tight monetary policy – still rising, in fact – and unemployment also the highest in many years, another mountain of taxes could well deliver PTI the kiss of death in provinces where crucial allies are already straining at the leash.
Yet the prime minister tells us not to worry, and makes fine speeches abroad about how he plans to lift the lowest, most miserable segments of society out of poverty; something on the lines of the impressive Chinese model. One reason why those fine words are not translated into reality is a complete lack of triggers in the economy. The State Bank did not lower the interest rate, even though keeping it high has done nothing to control inflation, quite blatantly contrary to the SBP governor’s proud claims. And high input prices, from gas to electricity to practically everything else, have priced us right out of the competitive export manufacturing and export market. Surely the PM knows that the Chinese didn’t lift all those hundreds of millions out of poverty just by talking about it.
Let’s not forget, of course, that food prices are too high for the poorest among us to even eat enough. How then will 2020, as the PM himself has claimed, be the year of Pakistan’s takeoff? The government must revise its economic policy immediately. Economies do not grow till people start spending and industries start producing. If the core basic failings are not addressed, these $6 billion form the IMF will also go waste, just like the hundred-odd-billion before them. Right now, PTI is acting exactly like PML-N, doing exactly the same things it criticised its predecessor to no end for. *