One time flood tax imposition opposed

Renowned economist Dr Hafiz A Pasha opposed the federal government's proposal to impose one time flood tax in the country to generate revenue to support the reconstruction and rehabilitation of around 20 million displaced people (DPs). He said imposition of any new tax on existing taxpayers would not help the government to generate desired revenue. In addition to this, Federal Board of Revenue could not get additional information about taxpayers.
He stressed the government to introduce tax-reform in country accordingly to its commitment in annual federal budget. "Government must extend vat on services and wealth tax if it desire to achieve the target of tax for flood affected people," Dr Hafiz said.
He was speaking at a conference. Barclays Bank hosted the One-day Development Organisation Conference on Thursday at a local hotel. The theme of the conference was 'the road to sustainable development: challenges, opportunities and alliances.
He said there were also other ways shown to government but it failed to enforce these steps. "We see the government failed to restructure the economy, cut down the current expenditure and introducing austerity measures within government departments," he said.
Replying to a question, Hafiz said the size of first democratic government of Pakistan People's Party was very small. The size of cabinet of present regime was large as it was a coalition government and every political party wants its representation in decision making.
He said one of the major challenges ahead to government was to convince the donors how serious they are in rehabilitating the flood affected people. During her speech on topic "The role of donor countries in meeting developmental challenges in a post flood Pakistan," Ambassador Robin Raphel said the US administration's main focus was preliminarily on three major adjustments. First, she said to invest in rebuilding infrastructure. Second, she said to help the governmental institutions where they needed finance like health, education and other social programme. Last, she said to support and develop the vulnerable areas like Khyber Pakhtunkwa, Northern Sindh and Southern Punjab.
She said most of donors' funding was going through international and local non-government organisation. The philosophy was they had capacity to deliver the services in possible short time. Earlier, Minister for State for Finance and Revenue, Hina Rabbani Khar said Since October 2005, Pakistan had appealed to international community from the platform of UN on four occasions.
She said due to world economic recession and a key alliance to US in war against terror Pakistan had been facing a number of challenges. "Since 9/11 incident, Pakistan's economy has been inflicted a loss of 40 billion dollars in war against terror," she urged. Despite, many challenges Pakistan's economy was stable and growing. Defending the government, Advisor to Ministry of Finance, Saqib Shirani said in current situation, public expectation to government was too high. Government should response to existed circumstances.
He said the government's first plan was not to make commitment to pay back internal and external obligations. "Along with imposing tax, government had other options too," he said, adding, World Bank estimated government could earn up to 16 billion dollars remittances which was policy driven. The export was reached to 19 billion dollars.
To overcome the energy shortage, he unveiled the government's energy policy. He said, the policy envisaged the import of LNG within two years. This fuel mixing would help to ease the pressure on import bill of petroleum and petroleum products. Country also signed Iran Pakistan gas pipeline project. The current energy policy also focused to promote indigenous sources of energy.
Other speakers who expressed their views on how to deal with this natural calamity include Advisor to State Bank of Pakistan, Dr Mushtaq Khan, former chairman Competition Commission of Pakistan Khalid Mirza and others. Chief Executive Officer of Barclays Bank PLC Shahzad Dada thanked the participants and offered his complete support to the development organisations. He said Barclays would like to facilitate the development organisations in enhancing their efforts in social development of Pakistan through this conference.
A number of international and local development organisations operating in the areas of education, healthcare, water and sanitation, relief and rehabilitation, monitoring and evaluation, power, entrepreneur and agriculture development participated in the conference.