Reduce Taxes – Best Solution of Economic Growth

Prime Minister of Pakistan
Mr. Shahbaz Sharif,

اسلام وعلیکم

I acknowledge your deep concern for the plight of millions of Pakistanis and your efforts to increase tax revenue to improve the conditions of the poorest segments of our society.

However, I would like to invite your attention to the fact that, as officially reported, the Federal Board of Revenue (FBR) has consistently met its tax recovery targets nearly 100 percent over the past several years. Given this success, why do we still face financial distress?

The core issue lies not in tax collection but in the continuous increase in government expenditures. Furthermore, the Finance Ministry has placed additional tax burdens on the already struggling salaried class, who, along with the unemployed, are among the few who pay taxes directly. In contrast, industrialists, traders, and retailers often transfer the tax burden to the general populace through increased prices.

If the government fails to alleviate the financial strain on salaried individuals and the unemployed, it risks losing the support of these critical voting blocs. IMF Chief Kristalina Georgieva has emphasized closing tax loopholes and ensuring the wealthy pay their fair share to mobilize funds for sustainable and inclusive growth. In September, she specifically urged Pakistan to increase taxes on the rich to protect the poor. Unfortunately, your government has taken the easier route of further taxing the already overburdened salaried class.

To address this imbalance, I urge you to consider an immediate reduction of non-development expenditures by 50 percent and development expenditures by 25 percent, alongwith immediately reducing taxes to the extent it were increased over the last year for the salaried class. Such measures would significantly boost the budgetary funds and the government’s income for the welfare of the poor.

The decision rests in your hands and requires considerable willpower, which I trust you possess in abundance.

Warm regards,

Syed Nayyar Uddin Ahmad
+92 321 9402157
Lahore.
nayyar51@hotmail.com