# *Detailed SUMMARY of the article "Lack of direction" by Editorial, Published in Dawn on June 12th, 2025:* The article analyzes *Finance Minister Muhammad Aurangzeb*'s challenges in securing parliamentary support for new legislation that would grant *sweeping punitive powers* to the *FBR* for *tax enforcement* and *tax-related litigation*. The minister faces resistance from his own *PML-N party*, *coalition partners*, and the opposition. His concerns stem from past experiences, including being prevented from announcing a proposal to *withdraw sales tax exemptions* for the *steel and edible oil industry* in *ex-Fata/Pata* during the budget for the outgoing fiscal year, which has now been included in the *next year's budget*. Aurangzeb presented lawmakers with a clear choice: either pass the legislation to empower *tax machinery* to recover *Rs389 billion* through enforcement measures, or prepare for *additional taxation* to achieve budgeted targets. The overall *FBR target* of *Rs14.1 trillion*, representing a *19% increase* from this year's collection of *Rs11.9 trillion*, appears overly ambitious due to *overly optimistic GDP growth expectations*, *moderate inflation targets*, and the absence of effective steps to tax *undertaxed and untaxed segments*. Analysts expect the *tax target* to be revised downward in coming months. The government's *growth projection* also faces downward revision risks, with Islamabad planning to pursue a *moderate growth rate of 4.2%* without breaching *IMF's red lines* or pressuring the *precarious external sector*. The strategy relies on *real estate sector rejuvenation* through announced *tax relief* and expectations of continued *upward trend in remittances*. However, this presents challenges as the new budget focuses on meeting *IMF loan stabilization goals*, *public development spending* continues to shrink as the government curtails expenditures to contain the *large budget deficit*, and *big industry* and *major crops* are contracting. The *IMF* has already revised its *growth projection for FY26* downward from *4%* to *3.6%*. The minister described his second budget as an *"East Asian moment"* for Pakistan, but the article argues that a budget lacking *bold reforms* and *strategic direction*, constrained by *PML-N's political concerns*, cannot be described in such terms. Even if growth goals are met, they remain *unsustainable* without a *structural shift* in the economy. # *Easy/Short SUMMARY*: *Finance Minister Aurangzeb* seeks parliamentary support for *FBR's punitive tax powers* amid resistance from *PML-N* and opposition. The *Rs14.1 trillion FBR target* (19% increase) appears ambitious due to *unrealistic growth expectations*. Government plans *4.2% GDP growth* through *real estate revival* and *remittances*, but faces challenges from *IMF constraints*, *shrinking development spending*, and *contracting industries*. The budget lacks *bold reforms* and *strategic direction*, making the *"East Asian moment"* claim questionable without *structural economic shift*. # *SOLUTIONS of The Problem*: ## *1. Build Political Consensus* Create *cross-party dialogue* to secure support for *FBR enforcement legislation* through consultation and compromise. ## *2. Realistic Target Setting* Revise *FBR collection targets* based on actual economic conditions and *realistic GDP growth projections*. ## *3. Tax Base Expansion* Implement comprehensive strategies to bring *untaxed and undertaxed segments* into the formal tax net. ## *4. Structural Economic Reforms* Introduce *bold structural reforms* beyond political considerations to create sustainable economic growth. ## *5. Diversify Revenue Sources* Reduce dependence on *traditional tax collection* by exploring *innovative revenue streams* and *digital taxation*. ## *6. Enhance Public Development* Increase *public development spending* within *IMF constraints* to stimulate economic activity and job creation. ## *7. Industry Support Measures* Provide targeted support to *contracting big industries* and *major crops* to reverse economic decline. ## *8. External Sector Strengthening* Implement policies to improve *external sector stability* beyond reliance on *remittances*. ## *9. IMF Negotiation Strategy* Engage with *IMF* to create more *flexible red lines* that allow for sustainable economic growth. ## *10. Long-term Economic Vision* Develop a comprehensive *economic roadmap* with clear *strategic direction* beyond short-term political cycles. # *IMPORTANT Facts and Figures Given in the article*: - *FBR* can recover *Rs389 billion* through enforcement measures. - *FBR target* of *Rs14.1 trillion*, up by nearly *19%* from this year's collection of *Rs11.9 trillion*. - Government plans *4.2% GDP growth* rate. - *IMF* revised *growth projection for FY26* from *4%* to *3.6%*. - *Sales tax exemptions* for *steel and edible oil industry* in *ex-Fata/Pata* withdrawn. - Minister called his second budget an *"East Asian moment"* for Pakistan. # *IMPORTANT Facts and Figures out of the article*: - Pakistan's *tax-to-GDP ratio* is *8.6%*, among the lowest globally (*World Bank*, 2024). - *Real estate sector* contributes *2.4%* to Pakistan's GDP (*PBS*, 2024). - *Remittances* reached *$27.2 billion* in FY24 (*State Bank of Pakistan*, 2024). - Pakistan's *budget deficit* stands at *7.4%* of GDP (*Ministry of Finance*, 2024). - *FBR* achieved only *85%* of its target in FY24 (*FBR*, 2024). - *East Asian economies* averaged *8-10%* growth during their boom periods (*ADB*, 2024). # *MCQs from the Article*: ### 1. *What amount can FBR recover through enforcement measures according to Aurangzeb?* A. Rs300 billion *B. Rs389 billion* C. Rs450 billion D. Rs500 billion ### 2. *What is the FBR's target collection for the upcoming fiscal year?* A. Rs12.5 trillion *B. Rs14.1 trillion* C. Rs15.2 trillion D. Rs13.8 trillion ### 3. *What GDP growth rate is the government planning to pursue?* A. 3.6% *B. 4.2%* C. 5.0% D. 4.8% ### 4. *What did the IMF revise its growth projection for FY26 to?* A. 4.0% *B. 3.6%* C. 3.2% D. 4.5% ### 5. *How did the Finance Minister describe his second budget?* A. "European moment" *B. "East Asian moment"* C. "American moment" D. "South Asian moment" # *VOCABULARY*: 1. *Sweeping* (وسیع) – Extensive or far-reaching in scope 2. *Punitive* (تادیبی) – Relating to punishment or penalties 3. *Enforcement* (نفاذ) – The act of compelling compliance with rules 4. *Litigation* (مقدمہ بازی) – Legal proceedings or lawsuits 5. *Coalition* (اتحاد) – Alliance of political parties or groups 6. *Exemptions* (استثنیٰ) – Freedom from obligation or liability 7. *Ambitious* (پرامید) – Having high aspirations or demanding goals 8. *Optimistic* (خوش بین) – Hopeful and confident about the future 9. *Undertaxed* (کم ٹیکس) – Not taxed adequately or sufficiently 10. *Precarious* (غیر محفوظ) – Uncertain or dependent on circumstances 11. *Rejuvenation* (تجدید) – Revival or restoration to former state 12. *Stabilisation* (استحکام) – Process of making stable or steady 13. *Curtails* (کم کرنا) – Reduces or restricts something 14. *Deficit* (خسارہ) – Shortage or amount by which expenses exceed income 15. *Contracting* (سکڑنا) – Becoming smaller or declining 16. *Dynamism* (حرکیت) – Quality of being energetic and forceful 17. *Devoid* (خالی) – Entirely lacking or free from 18. *Strategic* (حکمت عملی) – Relating to long-term planning 19. *Sustainable* (پائیدار) – Able to continue over time 20. *Structural* (ڈھانچہ گت) – Relating to fundamental organization 📢 *Attention Please!* We appreciate your commitment to acquiring knowledge through our summaries. 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Click the link below to join now 🔗 [Dawn Article Summaries](https://cssmcqs.com/dawn-editorials-articles-summary-for-students-pdf-download/) *WhatsApp Channel Link*: [https://whatsapp.com/channel/0029Va7tT3o35fLnJeFbpS2y](https://whatsapp.com/channel/0029Va7tT3o35fLnJeFbpS2y) --- *www.dawn.com* *Lack of direction* *Editorial* *3–4 minutes* FINANCE Minister Muhammad Aurangzeb's call to fellow parliamentarians, seeking support for new legislation that would give sweeping punitive powers to the FBR for tax enforcement and tax-related litigation, underlines the resistance he fears from his own party and coalition partners as well as the opposition. His concerns are not unfounded. Speaking at the post-budget press conference yesterday, he recounted how he was stopped at the last minute from announcing a proposal to withdraw sales tax exemptions for the steel and edible oil industry in ex-Fata/Pata in the budget for the outgoing fiscal year. The proposal has now been included in the next year's budget. He twice told lawmakers that they have the option of either passing the legislation and empowering the tax machinery to recover Rs389bn through enforcement measures, or to prepare for additional taxation to achieve the budgeted target. Even if his plan goes according to script, the overall FBR target of Rs14.1tr, up by nearly 19pc from this year's collection of Rs11.9tr, appears too ambitious due to overly optimistic GDP growth expectations, moderate inflation targets, and the absence of steps to effectively tax the undertaxed and untaxed segments. Some analysts resultantly expect the tax target to be revised downward in the coming months. And it is not just the tax target: the government's growth projection also faces the risk of downward revision. Islamabad says it plans to pursue an admittedly moderate growth rate of 4.2pc without breaching the IMF's red lines or putting pressure on the precarious external sector. It appears to be betting on the rejuvenation of the real estate sector through the announced tax relief and expectations of a continued upward trend in remittances. But this will prove to be a challenge, considering the fact that the new budget focuses on meeting the stabilisation goals of the IMF loan; public development spending continues to shrink as the government curtails expenditures to contain the large budget deficit; and big industry and major crops are contracting. In short, few believe that a government desperate to grow the economy can actually pull it off, as the dynamism required is not visible. This is underlined by the downward revision of the IMF's growth projection for FY26 from the previous 4pc to 3.6pc a few months earlier. At the presser, the minister dubbed his second budget an "East Asian moment" for Pakistan. However, a budget devoid of bold reforms and a strategic direction, thanks to the ruling PML-N's political concerns, can hardly be described in such terms. Even if we, for a moment, accept that the budget will meet its growth goals, it will remain unsustainable without a structural shift in the economy. *Published in Dawn, June 12th, 2025*