Economic Growth or Corruption Control Conundrums

Around the world replicas of monuments depicting the wealth of the Ancient Egyptians adorn the entrances of buildings such as malls, casinos, hotels. Their symbolic presence synonymous with wealth and opulence.In Pakistan, such symbolic references can often be seen in the gardens and entrances of residential schemes and houses. Traditionally the real-estate sector has served as a profitable segment of the economy, generally, considered a ‘risk-free’ investment, and often promising high returns on mainly speculative investment.

While the sector remains lucrative, it has been cited as a factor in widening the wealth gap and perhaps, inadvertently promoting some form of underhand dealings, be it tax evasion, money laundering, or outright fraud. Reports suggest that in Pakistan around 16% of the population accounts for 55% of the wealth, whereas around 72% of the population accounts for 1% of the wealth. Tax evasion remains a significant obstacle, with one recent report claiming that a mere 1% of the Pakistan population are registered active taxpayers. As a result the government has in a way been forced to concentrate on increasing the burden of indirect taxes to increase the tax revenue.

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