THE PAKISTAN DEVELOPMENT REVIEW
Pakistan Taxation Enquiry Committee Report (Review Article)
Taxes have a strategic role in the development effort of an underdeveloped country. The reasons are simple. First, there is the need to mobilize resources for the public sector. Second, voluntary savings are far short of a minimum desirable size of investment programme; there is thus need for increasing saving through taxes. And third, taxes provide the safest means of finance for economic development as concerns the inflationary effects of development spending. Furthermore, they assume added significance in influencing the extent and direction of private enterprise and in affecting the distribution of income. The recently released Taxation Enquiry Committee Report1 of Pakistan is of special interest and deserves close attention. The Report may be divided into two sections. In the first seven chapters it gives a survey of the existing tax structure. It summarizes the main features of the tax structure and examines their implications for development; fiscal trends over 1948-58 are analysed; the distribution of the tax burden among various sections of the population is discussed; the redistributional effects of the tax structure are examined; and the conflict between the objective of maximum economic development and of equitable income distribution is noted.