This is in response to my own short piece: Why there is no anti-tax narrative in Pakistan?
Actually, the Tax Payers Alliance Pakistan (TPAP) asked me to send something for their first ever issue of the Voce of Taxpayers. I thought what could be better other than this piece, why there is no anti-tax narrative in Pakistan. However, the editorial board of the magazine apologized for not using it citing the reason the TPAP is not against the taxes/taxation.
Is an anti-tax narrative really against the taxes/taxation, I asked myself?
Here is the answer.
The first country teeming with an anti-tax narrative that comes to my mind is the USA.
Also, I may claim and with no pride that it’s I who kickstarted an anti-tax narrative in Pakistan.
I do realize the acclaimed pride is misplaced; rather pitiful and sad. At best shameful.
The question is: Why this pride was not won by anyone else years back, decades back?
And it was a total surprise when I came to know/realize there was no anti-tax narrative, not the least in the country.
Mind it there was not a single sign of questioning any tax whatsoever.
Or I am ignorant of it.
In Pakistan, it was and it is an environment completely dominated by the pro-tax narrative.
And I saw all the practice of economics, from the colleges to the universities and to think tanks and to government institutions, revolving around the theme of taxes.
I came to find almost all the economists as hard-core pro-tax.
Unbelievably, they were/are all (barring a few!) part and parcel of the pro-tax narrative.
Their only preoccupation was/is strengthening the pro-tax narrative that vilifies the taxpayers.
Ask for the evidence, and I have it.
The Raftaar (Research and Advocacy for the Advancement of Allied Reforms) group campaigned against the tax-evasion. It consisted of certain top economists. The campaign was funded by the DFID (Department for International Development) of the UK. They placed advertisements in the newspapers (half-page), tv channels, etc.
That’s why I say, there prevailed and still prevails only one narrative, that is, pro-tax narrative in Pakistan.
Just last year, I heard one teen boy doing “I.Com.” in a private college saying: Here in our country people don’t pay taxes. It was his “I.Com.” teacher who put those words into his mind/mouth.
[I asked him: How the hell this state keeps on spending trillions of rupees every year?]
That’s the force and power of this narrative, that is, the pro-tax narrative.
Who constructed this narrative? The economists.
Any doubts? Watch the past editions of the Business Recorder especially, or any English newspaper, randomly, and see what the top economists are writing (and talking about).
One example: “Improving tax compliance,” by Dr Hafiz A Pasha; 3 October, 2023, Business Recorder.
[https://www.brecorder.com/news/40266153/improving-tax-compliance – Improving tax compliance by Dr Hafiz A Pasha 3 October 2023]
Add others to the list: Teachers/professors/students of economics, journalists covering the beat of economy, columnists, think-tankers, and who’s not.
[And international multi-lateral donors, such as IMF, World Bank, ADB, IFC, DFID, ASI.]
I put them all in the same basket, they are state economists.
In fact, they all invented a new economics, and I termed it as the State Economics.
Last year, during a discourse in a group comprising mostly economists, I raised a question: Can anybody justify any tax in Pakistan?
In fact, it’s about two decades earlier that I started questioning the rationale of any tax in Pakistan.
Yet, when I happen to ask why to pay taxes, random people, too, object: Then how the state will run?
That’s the spread and penetration of this pro-tax narrative that was conceived, constructed and strengthened by the economists.
The economists; yes, they are the culprit.
At the same time, that demonstrates that there prevails no market of diverse ideas in Pakistan specifically in the economic domain.
And, no doubt, the same economists seized all the intellectual space and left not an iota of room for another narrative or other narratives.
Under this overwhelming pro-tax environment, I put forward the idea of a civil economics as opposed to the state economics.
That civil economics questions the rationale of taxes and taxation in Pakistan.
That civil economics questions the theory and practice of taxation in Pakistan.
That civil economics questions the principles of taxation in Pakistan.
That civil economics questions the exorbitant taxes in Pakistan.
That civil economics questions the double and triple taxation in Pakistan.
And the civil economics I proposed focuses on the fundamental question: Why any tax/taxes at all?
Reverting to the point: What’s an anti-tax narrative?
In the USA, especially, there exists an array of opinions regarding the taxes and taxation, from anti-tax to lower and lowest taxes to hefty welfare taxation, and an equal emphasis on the purposes and uses of the collected taxes, and that such voices play an important role in the determination of almost all the issues facing the US state and government.
It is that environment that constitutes an anti-tax narrative, and it is this anti-tax narrative that balances the onslaught of the pro-tax narrative, and tries to create a niche for a different narrative to take root.
And in return, it is that environment created by an anti-tax narrative that enables the taxpayers to exert too much pressure on their governments so much so that they bow down to their demands and have to change their policies.
And it is the force and strength of this anti-tax narrative that holds back the US governments (democratic governments specifically), from an approach of careless taxation. And equally it is this robust anti-tax narrative that shapes the electoral debates mostly and it is because of this anti-tax narrative that presidential campaigns in the US particularly focus as much on the matters of taxation as on the issues of international politics.
In view of the above, interpreting the term and rationale of an anti-tax narrative literally does not do justice to both. Thus, the anti-tax narrative is not against the tax or taxes.
That is, the anti-tax narrative is a response to the pro-tax narrative.
A pro-low-tax narrative is no response at all to an all-out pro-tax narrative.
In 2021, speaking at a Prime Institute (Policy Research Institute of Market Economy) event, Arthur Laffer, an American economist, argued that taxes are basically a disincentive.
And, obviously transforming them into an incentive means keeping them low, unburdensome. That is, keeping their rates within the lowest range. In addition to that, the spending be transparent, and those who spend them be accountable to those who pay them.
That’s the gist of an anti-tax narrative.
In the end, let it be asserted again that interpreting the anti-tax narrative literally strips it off its spirit. And since this anti-tax narrative opposes the soul of the state economics, for those conversant/nurtured in the state economics, it is difficult to see its raison d’etre.
And in contrast to it, civil economics looks upon any tax as an extortion until and unless it stands justified by its reasonability and unburdensome-ness, its careful and frugal use, and does not violate the sense of acceptability by the people. Another more stringent test of a tax is: does it enjoy direct consent of the people!
That is what may be treated as the most important element of an anti-tax narrative.
24-11-2023
Islamabad
Note: For more information on the “Raftaar” campaign, check the following links:
https://profit.pakistantoday.com.pk/2017/05/15/a-guide-to-ending-tax-evasion-in-pakistan/
https://www.brecorder.com/news/2005807
https://www.dawn.com/news/1202741