The 2024-25 budget has become a focal point of intense public scrutiny and debate, igniting widespread discontent and controversy. The decisions and allocations included in this budget have far-reaching implications for the economy, society, and the livelihoods of the Pakistani people. The widening gap between the privileged and the marginalized, the impact of new tax measures on disposable income, and the potential consequences of increased fuel prices all underscore the significant importance of this budget.
The budget not only dictates the government’s financial priorities but also reflects its stance on addressing socioeconomic inequalities and addressing the needs of the general populace. The public’s reaction to the budget signifies its profound impact on the lives of ordinary citizens. Moreover, the budget has sparked renewed opposition to the government, emphasizing the critical role it plays in shaping public opinion and political dynamics.
Given the budget’s impact on inflation, tax burden, and the overall economic landscape, it is essential to closely monitor its implementation and potential repercussions. Any shifts in public sentiment, as well as the government’s response to the public outcry, will be indicative of the budget’s importance in shaping the country’s economic and political future.
Finance Minister Muhammad Aurangzeb’s recent claims following the passing of the 2024-25 budget have ignited a firestorm of discontent among the public. His announcement that existing exemptions for government officials have been continued, while nearly all other exemptions have been abolished, has poured fuel on the fire of existing frustrations. The public’s simmering discontent, exacerbated by the ongoing electricity load-shedding during high temperatures, has now reached a boiling point.
The budget has been widely criticized for widening the gap between the privileged and the marginalized. The decision to raise the salaries of 7% of the public workforce employed by the government by 20 to 25%, while exempting them from income taxes, has been perceived as a disregard for the taxpaying public and a reinforcement of existing anomalies in the tax structure. Furthermore, the exemption of real estate businesses from uniform tax rates has raised concerns about potential abuse and further exacerbation of inequalities.
Aurangzeb’s pledge to withdraw income tax on the salaried class once the economy improves has been met with skepticism, especially considering the budget’s significant increase in current expenditure. His claim that 750 billion rupees would be generated through ending tax evasion has been questioned, with doubts raised about the effectiveness of digitization in curbing tax evasion.
The public faces additional challenges as fuel prices have been raised, resulting in increased costs for transportation and essential commodities. When combined with the new tax measures effective from 1st July, the disposable income of the average Pakistani is expected to decline, potentially leading to profound and far-reaching socio-economic consequences.
The budget’s impact has reignited opposition to the government, especially among those burdened by the new tax measures. This may have implications of monumental significance, similar to those seen in recent political debates, where the need for alternatives has been emphasized.
Aurangzeb’s optimistic claim about securing a 6 to 8 billion dollar loan from the International Monetary Fund (IMF) has raised doubts, given the unsustainable budget deficit and its potential impact on inflation. The public’s reluctance to accept these burdens, coupled with the government’s failure to curtail its current expenditure, may further erode the budget’s acceptability over time.
In summary, the 2024-25 budget has faced significant backlash for deepening existing inequalities and failing to fulfill promises. Unless substantial changes are made, its acceptability may continue to decline, potentially leading to widespread public discontent.
