Experts Call for Broader Tax Reforms, Political Maturity

News Desk

Islamabad: An inclusive political economy shall be the top priority of the incoming government without any political fiddling by any of the stakeholders.

Politicians shall sit in the Parliament to do the legislation and ensure its implementation in letter and spirit. Whatever party comes into power shall limit the federal ministries count to 10.

The ministers shall pass on the vision and mandate to the teams of the technocrats as they know their job well. The performance of the governments world over depends on the technocrats based on ‘right person for the right job’.

This was the consensus among speakers from diverse professional backgrounds, including senior economists, at a webinar on “The Prospects of Charter of Economy for the new government and the new IMF deal” emphasized the need for politicians to concentrate on legislation in Parliament and ensure its effective implementation.

VC PIDE Dr Nadeem ul Haq said, “Pakistan is facing the brunt of political immaturity, inefficient governance system, bureaucratic negligence and stagnancy. Public expenses are huge for no output. The economic crisis cannot be addressed without addressing the cartel of banks, stock market malpractices, and the absence of technocrats in the governance decision-making.”

He added that there is a crisis of social contract and distrust among the politicians and other stakeholders. Pakistan’s economic issues cannot be resolved without a larger consensus on an economic framework. This will not be done by the politicians alone.

Dr Haq said, “We need to talk about the foundation issues for a larger national interest. Transparent and inclusive deregulation and an open market policy perhaps would help a lot to attract domestic and foreign investment in the soaring infrastructure.

He urged to abolish 40 federal ministries which are no longer needed after the 18th amendment, and to limit the federal cabinet to only 10 ministers. Parliamentarians shall work in the house on legislation, and let the relevant technocrats to design and implement the development agenda with the minimalist bureaucratic system. Pakistan cannot overrule the IMF observations and recommendations.

The speakers sought to demystify the role of the International Monetary Fund (IMF), viewing it as a fiscal regulator rather than a villain.

They advocated for a collaborative approach among all political parties and stakeholders to address issues such as budget deficits, expanding the tax base, eliminating subsidies, and reducing state expenditures.

Dr Nasir Khilji, a senior economist, said Pakistan is a victim of generosity of friends such as the USA, China, Saudi Arabia, UAE, and Qatar. Their support has been misunderstood and misused in Pakistan.

The country has also been a victim of vested interest of leadership across the board where, in many cases, the integrity lacked and reigned over the motivated objectives. Pakistan is a library of recommendations but no implementation of any proposed frameworks.

Dr Khilji said, “All the stakeholders of the country have to take the responsibility of inclusive economic reforms and their true implementation. The reforms shall include a comprehensive strategy to handle the budget deficit and reduce the nonproductive and operational costs.”

He said Pakistan has to broaden its tax, wipe off subsidies and reduce the financial burden of bureaucracy that produces hurdles only, he stressed.

Some major surgery is required for Pakistan’s entire financial management and governance system. It is not possible without having all the stakeholders on the same page. They have to come on the same page if they care about 250 million people, the senior economist added.

Devcom-Pakistan Executive Director Munir Ahmed urged the need of civil society observers in the political governance as a watchdog. They should have a role of oversight on the performance of the governance system, and their suggestions and recommendations shall be incorporated into the implementation of policy frameworks.