Record trade deficit may result in mini budgets

Islamabad Chamber of Small Traders on Sunday said record trade deficit is becoming unmanageable and it may soon result in new IMF loan and mini-budgets.

The trade deficit for eleven months has touched an all-time high mark of thirty billion dollars leaving the government with little options but to seek another IMF loan, it said.

Delay or refusal by the IMF can be disastrous as the government will go for mini budgets which will be catastrophic for the poor and the limping economy, said Patron Islamabad Chamber of Small Traders Shahid Rasheed Butt.

He said that current situation is very alarming and a wrong decision by the policymakers can have very serious repercussions.

Government continue to ignore meaningful reforms which has increased its dependence on indirect taxation which was already tilted heavily on the wrong side, he added.

Shahid Rasheed Butt said that the tax structure has increased the disparity in the distribution of wealth which is resulting in increased poverty, unemployment and extremism.

The country is suffering from regressive tax system as over seventy percent of the taxes are collected through indirect taxation, he said, adding that government should enforce a proper direct taxation system to force elite to pay taxes.

Million mobile subscribers paying heavy taxes despite the fact that earning of the majority of consumers does not fall under the taxable incomes.

On the other hand, out of 15 million rich and 25 million upper middle class only half a million file returns because they don’t trust the system.

The system remains to support rich and suppresses the poor widening the income gap which is against the national interests