How to revolutionize Pakistan's Tax System?

[shahbaz baig]

1. invest in mining and exploring the minerals to till finish products.. It will sort out all the economical problems of pakistan....

World Currency system depands on minerals Oil, Gold, lithium etc.

2. Use your allies, lobby and ISI to get the patent for mining, exploring to till finish products..

3. After acheving above points then you will be able to Run the system of the country otherwise forget about everything. Your country has been already hijacked.

 

[Nilgiri]

But this is just one side of the picture. The top down approach does not necessarily work.

From the data I have churned it works the best overall. When you try direct the forces through govt authority, you get very slippery slope creation long term which causes long term collapse....because eventually it turns into the have nots being able to extract from the haves too easily....and long term investment into everything is destroyed.

The argument must always be what is poverty and how to reduce that and eliminate it and what works best for that (free will charity is essentially the natural inclination of the society itself to help solve that for example). But inevitably when the govt gets involved (into forced commodity redistribution...be it subsidies from taxes or whatever), the issue does not focus on poverty anymore, it turns into forced equality (i.e getting rid of all inequality at all costs)....when it is the inequality in essence has arisen from far more complicated constructs in society and cannot be simply solved by throwing money at it (esp money you have extracted from far more potential productive purposes). In fact it does the opposite, inevitably you punish those that have succeeded and reward those that have not....by tyranny of majority essentially (given the perceived have nots will always outnumber the haves in a way a politician will draw and then exploit the definition made). The incentive to succeed and disincentive to fail is thus eroded mightily over time.....govt overreach essentially drastically shortens the cyclical time of boom and bust in a civilisation which to me is bad.

It is just very sad to me that most developing countries too early have fallen into this trap of arguing about and forcibly allocating the cake on perceptions.... rather than letting it grow naturally as big as it can (and the govt stays minimalist and focused only on the key things its there for in first place) till it hits/approaches its natural plateau cycle....when then the discussion can be broadened (and the govt and society itself hopefully has grown and matured to a level where it makes sense to do so).

Take the opportunity cost in Pakistan for example of how the govt has extracted this long from productive avenues to fuel whatever optics (in reality their offshore bank accounts etc) of helping the poor and needy...when really the Islamic Zakat is there in society already to address that organically and by free will.

@Joe Shearer @Gibbs @Chak Bamu

 

[Mumm-Ra]

From the data I have churned it works the best overall. When you try direct the forces through govt authority, you get very slippery slope creation long term which causes long term collapse....because eventually it turns into the have nots being able to extract from the haves too easily....and long term investment into everything is destroyed.

The argument must always be what is poverty and how to reduce that and eliminate it and what works best for that (free will charity is essentially the natural inclination of the society itself to help solve that for example). But inevitably when the govt gets involved (into forced commodity redistribution...be it subsidies from taxes or whatever), the issue does not focus on poverty anymore, it turns into forced equality (i.e getting rid of all inequality at all costs)....when it is the inequality in essence has arisen from far more complicated constructs in society and cannot be simply solved by throwing money at it (esp money you have extracted from far more potential productive purposes). In fact it does the opposite, inevitably you punish those that have succeeded and reward those that have not....by tyranny of majority essentially (given the perceived have nots will always outnumber the haves in a way a politician will draw and then exploit the definition made). The incentive to succeed and disincentive to fail is thus eroded mightily over time.....govt overreach essentially drastically shortens the cyclical time of boom and bust in a civilisation which to me is bad.

It is just very sad to me that most developing countries too early have fallen into this trap of arguing about and forcibly allocating the cake on perceptions.... rather than letting it grow naturally as big as it can (and the govt stays minimalist and focused only on the key things its there for in first place) till it hits/approaches its natural plateau cycle....when then the discussion can be broadened (and the govt and society itself hopefully has grown and matured to a level where it makes sense to do so).

Take the opportunity cost in Pakistan for example of how the govt has extracted this long from productive avenues to fuel whatever optics (in reality their offshore bank accounts etc) of helping the poor and needy...when really the Islamic Zakat is there in society already to address that organically and by free will.

@Joe Shearer @Gibbs @Chak Bamu

Sorry for the late reply. Was caught up in a few things. Can you share this data and explain how did you come up with this analysis?

 

[nang2]

Tax system will become more and more complex when government spending is getting bigger and bigger as government is struggling to find new tax revenue. So, revolutionizing tax system won't achieve anything unless it also revolutionizes government spending. If government only spends very little, it is very easy to design a simple and working tax system.

 

[somebozo]

Implementing taxes is not at all an issue with a honest government. But when tax evaders and money launders are the ruling elite of the country, they are unlikely to plug loop holes. Very good laws exist on paper in Pakistan, practice is nil..Pakistan first and foremost needs a culture of honesty and integrity. Pakistanis tend to be big liars for no obvious reason..

 

[Nilgiri]

Sorry for the late reply. Was caught up in a few things. Can you share this data and explain how did you come up with this analysis?

Looking at just USA for example (and just on the subject of poverty), I can assure you every other country with enough transparency and context (for level of development etc) is just scaled version of this phenomenon:

https://www.heritage.org/marriage-and-family/commentary/the-war-poverty-50-years-failure

https://www.investors.com/politics/editorials/war-on-poverty-failed-but-spending-continues/

The results/extraction ratio is phenomenally wasteful especially when there are newer more radical ideas we really should be trying out now (even within the framework of immoral forced extraction from top to fund the bottom) if the argument is to be made that supply side (often called trickle down by the left) itself will not do it quickly enough....esp with all this data we now have on big govt programs being terrible:

Like I would probably disagree with this guy in the TED talk on many things (he seems to be overall on the left in his approach and doesnt really approach the moral issue I talked about earlier), but he hits the nail on the head on pragmatism of the situation and prescriptions needed now rather than continue the same failures expecting them to change the results (whats the definition of insanity again?).

For more specific case of highlighting how bad some static govt spending structures are with zero interest to dynamically orient to the specific solutions:

https://www.sciencedirect.com/science/article/pii/S2352827316300970

The important thing to me is:

a) focus on poverty poverty poverty (not larger income inequality which politicians thrive on long term like leeches)

b) Define that poverty definition well and very simply/cleanly (absolutely important for eradication of it to happen, just like a disease/cancer)

c) Harness how community based free will charity works (social capital of culture) FIRST, and how to scale that up in govt case as the TED video talks about (and suggests basic income as prescription) w.r.t poverty....learn from the results and adapt the policy as needed (at highest resolution i.e community etc rather than nationally/state possible).......rather than optics-driven + static bureaucratic filled. top down elitist govt micro/macro-interventions.

This last part is always how a commodity re-allocation by govt (setting aside the moral argument of funding etc) should EVER work PERIOD. You fund the failure directly to individuals (voucher etc for education) and let them participate in the free market choices.... rather than get involved in the supply side (provide the only choice from centralised monolithic bureaucracy) of the free market based again on optics/politics to be exploited (and long term create atrocious things like public sector unions which literally bargain AGAINST taxpayers). Monopolies/cartels of supply ARE TERRIBLE, PERIOD. The TED video talks about the disparity in the resources needed to do it this way (with the basic income example).

I am also in favour of such approaches because as an Economics enthusiast myself, even under a immoral framework, I can identify that one approach delivers a result at much less cost than another approach even if they pose the same underlying moral problem (its not resources given by free will for a commodity provision) at the root. Thus I will always prefer the more efficient one.

@Joe Shearer @Desert Fox @Gomig-21 @Zibago @django @Gibbs