This island, that is, the civil economy, is sustaining the state (formal) economy and allowing the people to live at least a life with the semblance of a good life. Capturing it by the state would be fatal to the whole economy and society of Pakistan.
As the Pakistani statists are recommending the state to conquer this island and bring it under its control, and that by broadening the tax base, it will ultimately cut down tax rates.
Let the statists have the civil economy subjugated by the state and see themselves where they stand, then … not far from a Pakistani version of the French Revolution.
The lesson for the state is simple: follow the civil economy instead of crushing it to the benefit of Riyasati Ashrafiya.
In fact, the point to be noted is that no economic theory is applicable to the Riyasati Ashrafiya of Pakistan. It’s the nature of Ashrafiya.
Pakistani Riyasati Ashrafiya thinks they are feeding the people.
Remember, one PTI minister advised the people to eat one roti instead of two.
And PML-N’s Ahsan Iqbal advised the people to take one cup of tea instead of two. That’s the mindset of Pakistani Ashrafiya.
Another argument is put forward that though the tax rates may not be going down in that case, this measure will give the formal sector a more level playing field. And, thus, tax theft will also go down.
As for the formal sector, practically the formal sector functions mostly in an informal way. I mean their dealings with the state.
For example, it is told that under the Imran Khan-QJ Bajwa government, a delegation of APTMA (All Pakistan Textile Mills Association) met the then finance minister, Shaukat Tareen, and pleaded for a subsidy, of course, amounting to billions of rupees, which was duly approved.
And so far as the tax theft is concerned, it is argued that both the collector and the payers are involved. My view is that it is only the FBR that is responsible. Because the state agencies are instituted to serve the state’s constitutional objectives, if they are not fulfilling their duties, they are to be blamed for that, and not the people.
As is suggested above, the state should follow in the footsteps of the civil economy. In the same context, my view is that for Pakistan only one tax, that is, GST, is the way forward, and no income tax at all.
[19 Oct, 2026]