It is indeed heartening to note that the country’s external account position is gradually improving amid reports that the government will certainly clinch a four-year $8 billion deal with the International Monetary Fund (IMF) by end-July. In this regard, talks have begun between the government and an IMF team.
This positive report in particular has found its best expression from the performance of Pakistan Stock Exchange (PSX) where positive momentum continued yesterday as shares gained 700 more points.
Regardless of the fact that the conduct or performance of a stock exchange on any particular day cannot be described as the real barometer of a country’s economy, things appear to be moving in the right direction, at least for now or the weeks before the unveiling of the budget for financial year 2024-25.
The incumbent finance minister, Mohammad Aurangzeb, appears quite optimistic about the prospects of tax reforms. In hindsight, his optimism appears to be misplaced, to say the least.
It is nearly impossible to expand the tax net in any effective and meaningful manner in the absence of higher growth and absolute unwillingness or cooperation of those who are required to be brought into the tax net.
The honorable finance minister needs to be reminded the unfortunate treatment meted out to the then Federal Board of Revenue (FBR) chairman Syed Shabbar Zaidi by small and big traders alike during the initial period of the Pakistan Tehreek-e-Insaf (PTI) government.
He was humiliated and even roughed up at Governor’s House in Lahore by belligerent traders who had refused to allow the implementation of any tax reform. In my view, things haven’t changed much since. No doubt, Mr Aurangzeb has a very difficult road ahead. Be that as it may, I wish him good luck.
Nadira Khalid (Lahore)
Copyright Business Recorder, 2024
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