All public servants and others who get payment directly from the government exchequer will enjoy the new tax exemption. However the new measure suggests that the government has singularly identified common people as load bearer of all taxes while its employees will take away manifolds benefits without tax. There are no doubts the government employees as powerful lobbies are dictating the government, which is conceding to their demands to placate them to continue in power.
This is a political decision breaking financial discipline. It will create chaos at the end. Nowhere in the world common people are asked to pay each and every tax while government employees will enjoy all tax-free benefits on almost each and every facility. A government accountable to the people can never succumb to such pressure.
Public servants get various allowances and benefits, including lump sum grant during retirement. In many cases, tax officials claim tax on allowances. Public university teachers and employees also face the same problem. The NBR has expanded the areas of the tax exemption to keep everybody happy.
The previous order did not make clear whether employees in autonomous bodies like universities would enjoy tax exemption on allowances and such other benefits. The new NBR order has made it clear saying civil servants, employees of public and autonomous bodies, bank, insurance and financial institutions, police, BGB, officials in development projects, Judicial Service, armed forces will enjoy the benefit. The order has created an unjustified class of beneficiaries highly discriminating the common people.
Any sound tax policy calls for equal sharing of tax burden by all citizens. But our government is creating a class of official exploiters for its own political benefit. It will be counter-productive and self-defeating at the end. Doctors, for example, might wonder why they are left out of the order despite providing valuable public service. So might engineers and journalists, or school and college teachers and accountants.
Exempting some and increasing tax load on others is not part of a prudent fiscal policy based on public ethics and legal ground. We are afraid it may create wider socio-economic and political division in the society at the end. In the new situation government jobs will slowly concentrate to special privileged groups while the marginalized will become further marginalized. This is going to be a bad precedence that must stop.
