IMF pushing countries to burden poor with more taxes

The Institute for Social Justice (ISJ) showed a great displeasure over the International Monetary Fund’s (IMF) new trick to over burden poor masses with more taxes in the name of environmental protection. In its study “Getting Energy Prices Right: From Principle to Practice”, the IMF has indicated/asked to various countries that their energy prices are wrong since they do not reflect environmental damage, notably climate change, air pollution and various side effects of motor vehicle use such as traffic accidents and congestion.

This suggestion to countries like Pakistan is nothing more than providing an excuse or opportunity to increase fuel prices which are already higher, which have largely caused high inflation, increasing poverty and poor consumption powers by majority of citizens in developing countries. With the increasing fuel prices (which are often seen and reported every month) the life items from bread to life saving medicines go up. In other words, life has become cheaper than the life saving items. For one time meal, poor and working class youth have taken law in their hands.

The IMF rather suggesting (substantially investing) for creating alternatives of less harmful and cheaper sources of energies is pushing Pakistan and other developing countries to impose more taxes on poor. The IMF dreams that by imposing more taxes (which it gives the name of fuel tax reform), there will be substantial health, environmental and huge fiscal benefits. It says that with such efficient fuel prices there will be reduction in deaths caused by pollution (from fossil fuel combustion). In no way, the increase of fuel prices in the name of environmental protection will bring changes in the current practices and trends of deaths in countries like Pakistan where rule of law does not exits but the only worst governance, corruption, nepotism and maladministration.

Sadly, the IMF’s study has ignored more deaths caused by increasing poverty, high inflation and low purchasing power which are result of increasing fuel prices. There are already millions of children and women in countries like Pakistan dying because they cannot afford one time meal and life saving drugs. In these countries, malnutrition is result of hunger and poverty which infers at least half of the 10.9 million child deaths each year- five million deaths.

It is highly appreciable that the IMF has also suggested that countries should make arrangements for providing the consumers with an accurate assessment of the actual costs associated with any product or energy. Suggestions like these are unheard by countries’ top leaders, and unfortunately are never implemented, lamented the ISJ’s statement.

The ISJ considers that these kinds of studies are impetus to poor countries’ cruel and selfish ruler for imposing new taxes rather focusing on restructuring the tax system.

The ISJ’s press statement said that study should have only come up with recommendations that countries should reduce consumption of energy from fossil fuels and work on the least harmful options of creating energy sources such solar and wind, and also decreasing of industrial dependence on energy produced by fossil fuels products such as coal, natural gas, gasoline, diesel and petroleum. There should have been suggestions for shifting railways, public transports and ships from fossil fuels energy to cheap and less harmful energy sources.

The ISJ recognizes that the world has badly been affected by environmental pollution caused by emissions from fossil fuels but it regrets that the institutions like IMF has played central and bigger role in the destruction and damage of the world’s environment by imposing its only profit driven policies, which had and has increased only vulnerability of poor people to become easy prey of poverty and has given advantage to rich people to exploit poor people mercilessly.

The ISJ urged the IMF to wave off all loans it has given to Pakistan and other poor countries rather giving suggestions to increase taxes on poor by using humanistic approach.