ISLAMABAD (Eshfak Mughal): The Care Taker Finance Minister Dr Shamshad Akhtar said that the government is granting billions of tax exemptions to the Elite class that should be liable to pay tax.
She was briefing to the Senate’s Standing Committee on Finance on Thursday. The committee was met under the chairmanship of Senator Saleem Mandviwala here in Parliament House.
Shamshad pointed outed some discrimination in the tax system of the country. She said that the rich class is not paying its liable tax due to flaws in the system. The country cannot afford Rs 1,300 billion in tax exemptions. The government is giving Rs.1,300 billion tax exemptions to classes that should be taxed on wealth. This relief to the rich people must b stopped.
Shamshad Akhtar said that public expenditure in excess of income is the real cause of Pakistan’s economic problems.
She said that the government has been spending Rs 1,000 billion subsidies on electricity and gas. The financial constraints are not allowing the government to give un targeted subsidies, she said. She said that only countries with foreign exchange reserves of more than $400 billion can afford to give subsidies.
The caretaker finance minister announced the closure of all unlicensed money exchange companies and said that five banks have been given digital banking authority in September.
The Finance Minister claimed that inflation has structural problems. Recently, it is decreasing, having fallen from 38% to 25%. However, she said that the government is aiming to reduce inflation to 22 percent.
Dr. Shamshad Akhtar said that the review meeting with IMF will start at the end of October. The country has requested to the Saudi Arabia and China for more financing. She confirmed that the $700 million from IMF, $350 million from from ADB, $250 million from Islamic Development Bank. The government also expecting that the World Bank is also likely to give $450 million.
The government has taken a proactive approach to curtail fiscal deficit and reduce borrowing from domestic banks.