Prime Minister Shehbaz Sharif on Friday announced that the coalition government has decided to impose a 10 percent “super tax” on 12 large-scale industries in a bid to increase revenue and steer the country out of a prevailing economic crisis.
The industries to face this “one time” tax are: cement, steel, sugar, oil and gas, fertilizers, LNG terminals, textiles, banking, automobile manufacturing, cigarettes, beverages, and chemicals.
In a televised national address, Sharif said the government had no choice but to take some “tough decisions” in the federal budget for fiscal year 2022-23 to protect the national economy. “I want to brief the people about those decisions and the actual [economic] situation of the country,” he said, stressing that the new taxes were aimed at protecting the country from bankruptcy and ensuring relief could be provided to the public through measures that reduce the impact of inflation.
Reiterating that the “incompetency and corruption” of the ousted PTI-led government had brought the country to the verge of bankruptcy, he said these decisions would help to prevent this.
During his speech, the prime minister stressed that historically the poor had faced the brunt of sacrifices during times of hardship. “Today, it is time for affluent citizens to do their part,” he said. “It is their turn to show selflessness. And I am confident that they will contribute fully to play their part,” he said, lamenting the elite sought to evade taxes for their own profit.
It is the state’s responsibility, said Sharif, to ensure that all tax revenue goes to the national treasury. “We have been unsuccessful in this so far,” he admitted but said it was never too late to take corrective measures. “Right after the budget, teams have been formed to go all out to collect taxes. Assistance will be sought from all constitutional institutions and we will employ modern technology and digital tools,” he said, adding the key focus was stabilization of the economy. “These aren’t just words, this is the voice of my heart and InshaAllah we will be able to achieve all these targets,” he added.
In addition to the ‘super tax’ on industries, the prime minister said high-earning individuals would also need to pay more. He said that anyone earning more than Rs. 150 million annually would be required to pay one percent additional income tax; those earning Rs. 200 million and over would pay two percent; those over Rs. 250 million would pay three percent; and people earning more than Rs. 300 million annually would pay four percent additional income tax.
Referring to former prime minister Imran Khan’s calls for “independence,” Sharif said economic stability and freedom was the only way to break the “shackles of slavery.” Stressing on self-reliance, he said no nation could be independent without it. He lamented that while the country was a nuclear power, it remained economically “infirm.” Reiterating his call for a “grand national dialogue” and his charter of economy, he said if the country’s political powers would stop bickering amongst themselves, they could end poverty and stabilize the national economy.