The government is facing resistance from its coalition partner Awami National Party on the proposal of flood surcharge. Awami National Party is opposed to the idea of imposing flood surcharge. According to it, the matter to be placed before the Council of Common Interests (CCI), it has been learnt.
When contacted, Haji Adeel of ANP said his party was opposed to the idea and would suggest the government to bring the feudal lords into the tax net instead of imposing a new levy on the people already overburdened with taxes. The need is to impose income tax on large landowners with minimum annual earning of over Rs 300,000. S Jaffer Askari, an economist, was of the view that the government should withdraw tax exemptions to powerful lobbies and bring services sector and professionals into the tax net instead of putting burden on the masses of yet another levy in the name of flood surcharge.
There is a need to cut the size of the federal and provincial cabinets significantly and to control prevailing corruption in various public sector entities, he added. Another economist, Dr Zafar Mateen Nasir of Pakistan Institute of Development Economics, said that the discretionary funds of Prime Minister, Chief Ministers, Governors and public sector organisations should be done away with a view to creating a fiscal space for rehabilitation and reconstruction of flood affectees.
He said that any new tax would be inflationary and disastrous for the economy because it would increase inputs cost and subsequently the cost of doing business would go up. As a result, Pakistani exports would become increasingly uncompetitive in the global market.
Moreover, he said that prices of essential commodities which have already started increasing in the aftermath of floods would further go up in the case of imposition of tax at import stage. Pakistan Muslim League parliamentarian and spokesman Ahsan Iqbal said that a decision on such a critical matter should be taken at the level of the CCI.