- Even the new IMF target looks likely to be missed
Taxes are supposed to be inevitable as death, but it seems in Pakistan, the impossible happens. While no one has yet learned to stop the Grim Reaper from doing his job, it seems that it is possible to suborn the taxman. The ability to do so seems to be the only reasonable explanation for the inability of the current government’s failure to meet the collection target set by the IMF, even after it was revised downward. Now that the February collection figures are in, the picture for the financial year so far, July-February, is quite unappealing, not with the target missed by Rs 484 billion, and the final collection projected at Rs 4.8 trillion against a revised target of Rs 5.27 trillion, which would be a gap of Rs 447 billion. It is bad enough that there should be that big a hole in the national budget, but it also means that the IMF Extended Fund Facility will possibly go out the window.
One reason is the absence of a firm hand at the tiller. The PTI had brought in a FBR Chairman from the private sector with much fanfare, and it seems that his sudden departure for health reasons is connected with this failure. The Member Administration, Ms Nausheen Amjad, has the additional charge, but not only is she the sort of tax official thought unable to deliver (and thus needing an outside chairman), but being merely a caretaker, she has not given the FBR the sort of dynamic leadership it needs if it is to come near delivering on its target. The appointment of Haroon Akhtar Khan as PM’s Special Assistant on Revenue is being planned, but it is unlikely to do much. Besides, Haroon was SAPM to Shahid Khaqan Abbasi, so appointing him would fail to answer the question of how the PTI planned to raise revenue, besides adopting the baggage of the past.
The situation has come about because the PTI as failed to develop a taxpaying culture. While picking the right FBR chief matters, the PTI has also failed to show that it is worth paying taxes, that the taxpayer will get some benefit. Because of this ‘tax management’, a fancy way of saying ‘tax evasion’ continues, especially by businessmen who see that, for all its tough talk, the government caves in to street power, as shown in the recent traders’ strike.
