Pak's rich people could pay more tax

Pakistan on Wednesday said the government was ready to tax rich people more, insisting that in other countries the upper class pay higher taxes. Addressing a press conference a day after the government announced the budget, Adviser to the Prime Minister on Finance Hafeez Shaikh said that the average tax rate of Pakistan is 11-12 per cent, which is "one of the lowest in the world."

"If we have to offend some people for this (increasing tax rate), then we are ready to do it," he said. The tax target for this year has been set at Rs 5,550 billion, which many experts believe will be difficult to meet.

He defended the tax target for 2019-20, saying "Pakistan's people, especially the rich, will have to be sincere with the country and will have to pay taxes." He addressed the post-budget conference to clarify queries of media regarding the Rs 7022 billion budget announced on Tuesday.

He said more social safety nets and public sector development had been increased. "We also need to pay loans. So naturally, we need more money," he said.

Shaikh urged for austerity and said the government should reduce expenses if it was demanding more taxes from the people. "The focus of the budget is to check fiscal and external deficits, adopt austerity measures, and reduce expenditures of the government," he said.