Opposition won't support tax hike without govt spending cuts
He also listed some reforms and actions this government needs to take to manage financial challenges before raising taxes.
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By
Fathmath Ahmed Shareef
Former finance minister Ibrahim Ameer on Saturday said he was not in favour of raising taxes from the ‘pockets of the people' without bringing in reforms from within the government to tide over the financial crisis.
The government has decided to take a number of measures to overcome the current financial difficulties. The government has decided to increase GST and import duties on goods and services from next year.
Ameer expressed concern at a press conference held at the MDP office on Saturday over the measures being taken and planned by the government to increase revenue. When asked about the tax hike, Ameer said he did not support the tax hike at this juncture.
Asked why he did not support the tax hike now when it was done in his tenure as the finance minister, he said: “The tax hike was then based on extensive research and statistics obtained by working with the IMF and the World Bank”.
If today's government had been managing the finances of the state and doing the things mentioned in this year's budget, it would not have reached today's situation, he said.
“So without bringing these reforms, the issue arising out of their incompetence should not be put on the heads of the people. I'm asking them to bring those reforms first. Through these reforms, they can then study and carry on with it,” said Ameer.
He also explained the reforms and actions this government needs to take to manage financial challenges before raising taxes. As such, the Ameer said:
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Ensure the sustainability of the financial situation
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Implement the reform measures included in this year's budget as per the budget
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Preparation and publication of a national development plan
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First, instead of delivering into the people's pockets, reduce political positions and therefore reduce government spending
Last Wednesday, the Ministry of Finance released the government's Medium Term Revenue Strategy (MTRS) report for the next four years, approved by the Cabinet.
According to the report, the measures to be taken before the end of this year to increase revenue are:
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Increase the fees and taxes currently levied on airport; the airport development fee is planned to be doubled
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Reviewing some of the duty concessions currently granted under the Export Import Act; under the policy, duty concessions on goods imported to regional ports will be ended.
