A debate has been started over the budget. Some people are appreciating it as an investor-friendly and development-oriented while some are terming it a jugglery of words having nothing for the general public. On the one hand, the federal budget for the financial year 2005-06 is larger than the previous year, is considered a balanced, people and trader-friendly and encouraging for all. Some important features or omissions of the budget are discussed here.
The target of the sales tax collection has been increased from Rs.55 billion to Rs.294 billion while the target of the income tax has been raised from 30 billion to 206 billion. In a situation, when hundreds of the industrial units have been declared sick and closed down the achievement of such huge targets are looking impossible.
Although the government is claiming that no new tax had been levied this year and a lot of incentives have been announced for the businessmen and investors. The economic managers are also saying that the increase in the revenue target will not affect the general public. Similarly, another claim is the assurance that no mini-budget would come.
There is nothing new in these assurances as the people have gone through a vast experience of such tall claims. The spiral of the price hike is badly affecting the lives of the people as the prices of petroleum products, electricity, ghee, flour, pulses, rice, fruits and vegetables are touching the sky and living a honourable life for the common man has become difficult.
Reality is that there is no relief package for the poor segment of the society. Like in the past the incentives and facilities announced would benefit only the industrialists and big investors. However, we should be hopeful that the government-announced programs and other expectations would bring fruit. Millions of poor and middle class people should at least have the right to live. All the developing countries of the world are adopting measures for facing the challenges of the free trade phenomena and for protecting their economies in the new emerging economic scenario of the world, but we lack such kind of efforts. The inflation rate had reached to concern a point of touching 9.3 percent.
No doubt the government had sanctioned a handsome amount for the development and promotion of the important sectors, but the requirement of the day is that these sectors should be developed on a modern pattern.
Rs.18.40 billion sanctioned for the construction of roads and buildings is an important step in connection with the WTO regime. The construction of quality roads is a must for development in the post-WTO regime. Water and sanitation would get billion, food subsidies Rs.1.36 billion, food support programme Rs.420 million and Rs.500 million for the housing schemes for low income people. The implementation of these projects would benefit the poor and down trodden class in society.
The government has given these figures, but the real requirement is the spending of the amount in the right way and direction. The past precedents of the spending of such amounts merely on registers should be abandoned at once. The government has allowed the import of CNG kits and their duties have been reduced to 10 percent.
The step would also help reduce the transport fares and pollution would also be brought under control. Laundry, dry cleaners and wedding halls have been exempted from the sale tax, but Customs Clearing Agents, who are playing the role of a bridge between the exporters and Central Board of Revenue (CBR) are not given any relief. The clearing agents are also service providers to exporters and help as a tax machinery in the collection of billions of rupees revenue.
They should also be exempted from the sales tax to help mitigate their problems and improve their performance. Duty on vehicles imported under gift schemes has been cut down by 50 percent. But, the people were expecting the revival of the amnesty scheme and permission of the import of reconditioned motorcars. Any such steps would have legalized thousands of smuggled vehicles and millions of rupees revenue would also have been generated.
The people are now looking towards the upcoming trade policy and looking for the abolition of a ban on the import of reconditioned vehicles as was announced by former prime minister Mir Zafarullah Khan Jamali, Federal Minister Liaquat Ali Jatoi and Minister for Commerce, Humayun Akhtar Khan and federal secretaries on several occasions. The announcement of the Minister of State for Finance that the government is relieving the national economy of foreign loans and assistance is encouraging and good.
The resources of our country were mercilessly looted by a particular group and influential section of society, the story of which is not any less gruesome in the world. Although the phenomena of loot and plunder of the national resources is not new in our country, but the situation witnessed during last two decades is alarming.
On the one hand millions of poor lack basic amenities of life, while on the other hand a group of influential and resourceful people are busy in looting the national exchequer with both hands.
The group comprises of big landlords, feudal, maliks, chaudrys, waderas, industrialists, politicians and top bureaucrats, who not only obtained huge loans for themselves, but also helped provide them to their relatives. A lot of them had written off their loans and played a role in the looting of the national exchequer. The government should pay attention to the recovery of the billion of rupees written off on loans from the habitual and chronic bank defaulters. Such steps would not only help return foreign loans but would also help government initiate some public welfare-oriented projects. The government should pay attention to this.
(The writer is a member of the executive committee of the Sarhad Chamber of Commerce and Industry.)
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