Pakistan Finances

The Urdu word for taxes ( mehsool ) probably sounds no sweeter to the Pakistani ear than "1040" does to Americans. But Benazir Bhutto, prime minister of a country where only an estimated 1% of the population pays taxes, has imposed heftier levies to trim the fiscal deficit. Prices on scores of domestically produced consumer items and imports--from a small cup of ice cream (now 21 cents) to a computer ($1,800)--have zoomed upward by 20% in consequence.

When a rich Persian Gulf sheik with a bad heart and a reputation for heavy drinking died two years ago, he saddled a state-owned bank in Pakistan with a $227-million debt he had refused to pay for more than two decades. In a separate case, an Arab princess and the Emirate of Sharjah stiffed the same bank, United Bank Ltd., for $87 million, Pakistani President Pervez Musharraf said in a letter to the ruler of the United Arab Emirates.

When a rich Persian Gulf sheik with a bad heart and a reputation for heavy drinking died two years ago, he saddled a state-owned bank in Pakistan with a $227-million debt he had refused to pay for more than two decades. In a separate case, an Arab princess and the Emirate of Sharjah stiffed the same bank, United Bank Ltd., for $87 million, Pakistani President Pervez Musharraf said in a letter to the ruler of the United Arab Emirates.

The Urdu word for taxes ( mehsool ) probably sounds no sweeter to the Pakistani ear than "1040" does to Americans. But Benazir Bhutto, prime minister of a country where only an estimated 1% of the population pays taxes, has imposed heftier levies to trim the fiscal deficit. Prices on scores of domestically produced consumer items and imports--from a small cup of ice cream (now 21 cents) to a computer ($1,800)--have zoomed upward by 20% in consequence.

Dismissal of Pakistani Prime Minister Benazir Bhutto threatens the strategic South Asian nation's shaky hold on democracy once again. But if Bhutto accomplished little for Pakistan during her latest term in office, the army will not do more. It should stay in the barracks.