The president of the Hyderabad Chamber of Small Traders & Small Industry (HCSTSI), Muhammad Saleem Memon, has said in a statement that the core reason behind Pakistan’s narrow tax net and limited number of taxpayers is the lack of public and business community trust in the government’s utilization of tax revenues. He emphasized that unless people are assured of transparent and effective use of their paid taxes, there can be no significant improvement in voluntary tax compliance.
He highlighted that despite billions of rupees being collected in taxes annually by various departments, the public and business sectors continue to suffer from a lack of basic civic amenities. Roads remain in poor condition, hospitals and schools are dilapidated, and municipal services are constantly declining. He pointed out numerous reports, including those from the Auditor General of Pakistan, have consistently revealed massive financial irregularities and mismanagement in public funds, but no meaningful accountability has been ensured.
The HCSTSI President stressed that strengthening the tax system is impossible without restoring the confidence of the business community. Currently, traders feel that they are being forcefully taxed, yet their issues remain unresolved. He urged the federal and provincial governments to publish detailed annual expenditure reports alongside tax collection data so that citizens can clearly see how and where their money is being spent.
He added that if the government ensures the transparent use of public money, it would boost current taxpayers’ confidence and motivate non-taxpayers to become part of the formal economy. He noted that Pakistan’s tax-to-GDP ratio is lower than other regional countries such as Bangladesh and Sri Lanka, reflecting the public’s deep mistrust in managing tax revenues.
Drawing comparisons with developed nations, Mr. Memon stated that one key reason behind their success is the public’s trust in their tax systems. For instance, in Canada, each taxpayer receives an annual breakdown of where their taxes were spent. In Norway, citizens have access to detailed expenditures of any public project. South Korea’s “Taxpayer Bill of Rights” gives people full awareness and holds the government accountable. As a result, people in these countries willingly and confidently pay taxes.
He called upon the Government of Pakistan to introduce a Tax Monitoring Portal where every citizen can view ongoing developmental projects in their respective areas funded by tax revenues. He also demanded immediate and strict action against those involved in misusing public funds to restore public trust.
Chamber President Saleem Memon concluded that for Pakistan to become a self-reliant and economically strong nation, transparency in tax utilization is imperative. When the public realizes that their tax contributions are being used for the betterment of their own lives and not merely to support government extravagance or lost to corruption they will not only willingly pay taxes but also encourage others to do the same. This is the foundation on which a prosperous and stable Pakistan can be built.
