We’re all Responsible for fiscal Mess: Shabbar Zaidi, Partner A.F.Ferguson
“Government, businessmen and the public at large were all responsible for the fiscal mess the nation finds itself in” said Shabbar Ziadi, leading tax expert and partner of A.F.Ferguson, at a budget seminar organized by Institute of Cost and Management Accountants of Pakistan (ICMAP).
Noting that debt servicing, defence, subsidies and administrative expenses formed 31%, 16%, 25% and 11%, respectively, in the proposed budget, Zaidi said that 83% of the allocations were set aside for non-productive expenditure.
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He stated that the increase in total debt was approximately Rs1.5 trillion per year. With the debt level reaching Rs13 trillion, he said the fiscal deficit would be around Rs1.8 trillion next year. “This country can’t be run with this kind of a fiscal deficit.”
Users of electricity, especially ‘commercial consumers,’ ask for electricity, but contribute nothing to the exchequer, he said, adding that the agriculture sector – both production and trading segments – paid little in taxes.
Criticising those calling for severing trade ties with the western world to make the country ‘sovereign,’ Zaidi said the United States would always remain the main buyer of Pakistani products.
Referring to a research study, he said US per-capita income was likely to be $88,000 in 2050 as opposed to China’s $39,000. “The aging populations of the European Union and the US are an asset for countries like ours.”