KARACHI: A talk by economist and chartered accountant Muhammad Raza on ‘Sahoolat Ka Husool Ya Dushwar Zindagi’ at the Urban Resource Centre (URC) on Tuesday emphasised that the state must justify its right to collect taxes from taxpayers.

“Your taxes should make life easier for you. What is taken from you in taxes should come back to facilitate you,” said the expert.

“Fair taxation, accountable institutions, visible public value all amount to gain as the bigger picture,” he added.

“Unfortunately, we have all witnessed or been victims of a lack of law and order, bad roads, bad drainage system, etc. But it is the state’s responsibility to provide us these things because we pay our taxes,” he said.

Economist talks about state’s responsibilities after tax collection

“These are the obvious things. There are also things you don’t experience on a day-to-day basis such as law courts and the justice system. Thus the state must justify to the taxpayers its right to collect taxes,” he said.

“Every citizen must also feel that he is not being overtaxed. There is something known as horizontal equity in which you are taxed according to your earnings. But here in our country the salaried people are taxed according to one rate, the businessman is taxed at another rate even though both may be earning the same amount. It is not an equitable system because you are not charging tax according to one’s earnings but according to one’s profession,” Mr Raza explained.

“Another thing is filing your tax returns, which brings up all kinds of hurdles for the filers. It is for this reason that many people avoid coming under the tax net. Suppose someone was not filing his or her tax returns but starts doing it now. That is when he or she will be bombarded with all kinds of notices and questions making one wonder about their mistake of honestly thinking of becoming a filer,” he said.

“Besides, taxpayers deserve free health and education facilities but here they are paying for health and education from their pockets despite paying their taxes. Well, okay, there are government hospitals and government schools but either they are just not enough or just not there in your area. Besides, they don’t offer quality services, forcing one to approach private services,” he said. “Then you ask yourself what happened to the tax money you paid for these very services?

“But even if you don’t file your tax returns you still are paying taxes in the shape of sales tax,” he pointed out.

“We have a federal government and the provincial governments. So the tax money is distributed from the federation to the provinces as per a formula of the National Finance Commission which came as a part of the 18th Amendment. So if I pay 100 rupees as tax to the federal government, 58 rupees from that Rs100 go to the provinces. So Sindh gets about 14.5 rupees of its share from that to be used according to its needs and requirements,” he said.

“Then when I look towards the federal government, they are not left with much to take care of their expenses so they require loans, local and foreign. And these loans come with mounting interest,” he concluded.

Earlier URC’s Joint Director Zahid Farooq welcomed the guest and architect, town planner and URC chairman Arif Hasan gave the vote of thanks.

Published in Dawn, September 30th, 2026