Every income should be taxed: Tareen

Former Finance Minister, Shaukat Tareen has stressed the need for increasing tax to GDP ratio to 15 percent by 2014, saying every income should be taxed whether it is agricultural or other sector. He was addressing the seminar "What must be done to avoid a financial collapse and strengthen the economy of Pakistan", organised by Foraminate Alumni Association Annual Reunion 2011 at Forman Christian College University on Friday.
Rector of the varsity, Peter H. Armacost and famous industrialist, Yusuf H. Shirazi were also present on the occasion. Tareen said that Pakistan has the lowest tax to GDP ratio in the region. He said that the major issues regarding the economic condition are bad governance, mismanagement and non-implementation of austerity measures. He revealed that 22 VIP planes are used by the President, Prime Minister and Chief Ministers, while there are 40 to 50 cars in their fleet.
He opined that there should be no subsidy on provision of petroleum and electricity for the rich and privileged class, whereas government should issue cards through which poor people could get subsidy on petrol and electricity. He also said that the country has very low savings. In the present economic scenario, he added, government is trying to create economic stability by printing currency notes, which has increased inflation. He observed that due to inflation, investors are hesitating to take part in long-term financing.
The minister termed agriculture backbone of the economy. He pointed out that since 1960s, our growth rate in the agriculture sector is decreasing. He suggested that we have to invest in seed development and building water reserves for the uplift of the sector. He also said that government should take steps for the export of value added products, such as vegetables and flowers.
He lamented that there is an agriculture tax, but the provinces are not collecting it. He emphasised the need of increasing public private partnership for the development of agricultural infrastructure. He stressed that the issues of good governance and mismanagement must be resolved. Speaking on the occasion, renowned industrialist, Yusuf Sherazi said that socio-economic conditions can be resolved through entrepreneurialism and not through technocratic approaches. No amount of shuffling the pack to include the emerging markets will make any difference unless they and the rich countries are aware what tough decisions have to be made, and are willing to face their domestic constituencies. The crisis has now produced a new world order, he articulated.
He also said that Pakistan will have to be guided by their national interests in following any policy emanating from external affairs. "It is thus a coalition for development and as such globalisation through localisation - globalisation - local investment. Production and export - not globalisation, is in the global interest," he concluded.