Managers need humanity

LAHORE: The state has done its part by raising the wages of low-paid employees by 15%, but the majority of workers are employed by the private sector and receive low wages with no compensation for high inflation.

This time, instead of asking the common man to suffer more, planners must ensure that all tax evaders and under-filers not only pay their owed taxes, but also share their wealth with working people. more than providing them with daily use items at subsidized rates. .

Salaries are only a small part of the costs. Companies raise the prices of their products in line with rising input costs, but ignore the fact that price increases everywhere also affect their workers.

A 0.5 to 1% increase in the prices of their products and services would generally be enough to increase the salaries of their staff in line with prevailing inflation, including the provision of subsidized daily use items. The well-being of their human resource should be at the heart of all businesses.

Economic managers should stop the blame game and take concrete steps to correct inconsistencies in economic policies that tend to benefit the rich and hurt the poor.

The common man is not ready to heed the oft-repeated slogan of trusting the government and caring about future welfare.

The theory of hard economic decisions at the expense of the poor to generate more revenue is the same one recommended by the International Monetary Fund (IMF) in its 23 engagements with Pakistan, only after its failure to convince leaders to generate revenue at from the rich.

Pakistan faces an acute resource crisis. Government expenditures are much higher than its revenues.

Revenues must be increased, but in a sensible way by closing the loopholes in the tax machinery. This could only be done through 100% transparency in government affairs.

Almost every government at the beginning of its term promises that resources would be generated according to the capacity of each segment of society.

Unfortunately, none have come up with a solid and tangible strategy for ensuring fair taxation that spares the poor and targets wealthy segments of society.

Instead, inequality continues to rise in society throughout all government terms. However, inequality has increased further over the past four years.

Raising income should not be the sole objective of the state. Securing a better life for the millions of workers who work hard to secure higher incomes should also be an integral part of government policy.

When the government raises the salaries of state employees (almost every year based on prevailing inflation), it should decree that the private sector must also implement the same increase. Entrepreneurs would factor in the additional cost the same way they adjust for the impact of higher taxes and government levies. It is inhumane for companies to ignore their workers while raising the prices of their products with every increase in electricity, energy or oil prices.

They have every right to consider these increases, but they also need to realize that these increases, plus the increase in the rates of essential items, also have an impact on their workers.

Successive governments in Pakistan have succumbed to political pressure and instead of generating revenue from those who can, they have opted for the easy way out of accumulating resources through indirect taxation.

The time has come when every citizen should be compelled to pay taxes according to his ability. It is criminal to indirectly generate 65% of taxes which are shared equally between the poor and the rich.

In fact, gasoline taxes, gasoline surcharges, sales tax, excise duties, and customs duties are such taxes that the rich collect from the poor with interest. Second, many manufacturers hide their actual production to save sales tax, excise, and under-file their import bills to pay less import levies, while charging consumers government taxes on their products.

Direct taxation should be the main source of state revenue. An analysis of income tax collected by the Federal Bureau of Revenue would reveal that 80% of income tax is collected from 100 companies in the corporate sector (banks contribute almost 10% of tax on income).

The working class comes next, contributing more than seven percent of the total income tax, while thousands (over 50,000) of manufacturing and trading enterprises contribute only thirteen percent, five percent of which come from traders and transporters.

This means that manufacturers in Pakistan, including textile, sugar and engineering companies, pay almost the same tax paid by the working class. The difference between the way of life of the majority class of tax-paying wage earners and that of entrepreneurs, transporters, merchants and owners is visible to all. The lifestyle difference should be reflected in tax payments.

About Donnie R. Losey

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