5 percent reduction in elite’s taxes

[Lahore_Real_Estate]

Govt shifts burden to common taxpayer

LAHORE: For the first time in the history of Punjab, the provincial government has given five percent relaxation in taxes to the elite class, and has shifted the burden of that percentage of taxes on the middle, lower-middle and working classes through indirect taxes. The decision was revealed on Friday by the opposition in the Punjab Assembly (PA) during the general debate on budget for fiscal year 2011-12.

The Pakistan People’s Party-backed (PPP) Ahsanul Haq Ahsan Naulatia, while inaugurating the budget debate, told the House that the Pakistan Muslim League-Nawaz (PML-N) government had increased indirect taxes by five percent and had reduced the same percentage in the direct taxes. Direct taxes address the elite class whereas indirect taxes aim at the general public, especially the middle, lower-middle and working classes of the province.

He informed that the government had announced in the budget that it will collect a total of Rs 88 billion through direct and indirect taxes from the citizens during the next fiscal year. “The government plans to collect Rs 65 billion through indirect taxes, which makes up 75 percent of the total amount, greater than last year’s percentage of 70 percent,” Naulatia added.

This implies that the government has imposed more taxes on the poor masses of the province who will pay them through increased utility bills, he said.

Separately, Naulatia explained that the government had given relaxation to the privileged class by reducing five percent of the direct taxes, which previously made up 30 percent of the total taxes, adding that now only Rs 23 billion would be collected through these taxes.

He said that to compensate the reduction, the burden had been shifted on the general public, which is already struggling and fighting price hike and inflation in the country.

Nautalia, while criticising the provincial development programmes and poor financial policies of the Punjab government, informed the House that the PML-N government was also facing a debt of more than Rs 492 billion of which at least Rs 416 billion was held by foreign creditors. He suggested the Speaker to continue the budget session for at least another 30 days to make the budget more healthy and workable.

In response, Ch Sarfaraz Afzal from PML-N, said in his speech that the reservations voiced by the opposition were misconceptions since PML-N had imposed new taxes on big farmhouses as well as luxury vehicles, all of which are services enjoyed by the elite class.

Similarly, he said, the government had introduced the Yellow Cab Scheme (YCS) and the Ashiana Housing Scheme for the betterment of the poor classes.

PA’s budget session, on Friday, started one hour and 22 minutes late from its scheduled time of 9am under the chair of Speaker Rana Iqbal Ahmad Khan. Soon after the recitation of Quranic verses, the Speaker started the budget debate in which members of all three major parties, PML-N, PPP and PML-Q, participated. Prime Minister Yousaf Raza Gilani’s son, Abdul Qadir Gilani, also participated in the general discussion on the budget and highlighted issues pertaining to southern Punjab.

Qadir Gilani informed the House that the last year’s devastating floods had affected more than 62 million people in southern Punjab. He requested that Rs 50,000 each be provided to the flood victims, as per the chief minister’s (CM) statement during his visits to the affected areas of southern Punjab.

He also suggested that instead of spending large amounts on construction of model villages in the affected districts, the government should give Rs 0.1 million to every family affected in the floods so that they could self-construct small houses or rooms for their living.

Qadir Gilani appreciated the project of Danish Schools but said that a strong infrastructure of educational institutes already existed in all the districts and tehsils of the province, hence, it would be better if the PML-N government tired to provide missing facilities to these schools rather than establishing new schools.