Whether under a democratic government or a military set up, most of the economic policies faltered during the implementation stage or proved to be failure at the end. The pressing question is that who is in charge of the administrative, economic and financial affairs of the country in any government as no one has ever been held responsible for the failures. The recent tax amnesty scheme though gained some success, but the rate of success is not even a few percent of the target envisaged by the policymakers at the start of the programme. The last date for filing the tax returns has passed and the scheme has been silently winded up without any word from the government side. The new budget is days away and the government is reportedly weighing options to slap additional taxes amounting to Rs 175 billion on the people to reduce fiscal deficit and increase tax-to-GDP ratio by half percent. According to experts, the government finds it easy to slap new taxes instead of taking solid steps to enhance tax net. In corrupt society, in corrupt environment and in corrupt official machinery, it is not difficult to understand why the nation lags behind the least developed nations.
An understanding about corrupt society always stays deeply in the minds of the policymakers. That is why tough rules and regulations are drafted in a way to plug all the loopholes to remove any chance of tax evasion. But tough laws create fears among the potential investors and taxpayers, leading to capital flight form the country. The government is planning to raise the tax collection target by 18 percent in the coming budget without realizing the situation on the ground. The country is already facing falling exports, energy crisis, law and order and witch-hunting of the owners of small and medium business organizations. Without improving the business environment, the government is opting for more revenue and this unrealistic approach will possibly end in smoke. The hue and cry of the offshore companies, in which the top government dignitaries are also allegedly involved, has not subsided and unrealistic targets will lead to increase investment of Pakistani businessmen in foreign lands.
Finance Minister Ishaq Dar has explained on various occasions that the government will target the non-filers and will not put extra burden on existing taxpayers. However, he will have to improve capacity building of the tax machinery to implement his vision in letter and spirit. The federal budgets are often copy-paste work and jugglery of words and mini-budgets haunt the nation the whole year. The government will have to bring drastic changes in its policies to revolutionize the look of the economy before it is too late.