Foreign loans for development projects look good in theory. However, the government has to be careful while signing such agreements. This is because along with foreign loan, the government also has to pay interest.
This high amount can only be paid if the government has enough revenue. In our country, the main source of income of the government’s revenue is taxes. In order to pay the loan back, the government increases the tax rates of both direct and indirect taxes. As a result, the price of essential commodities shot up. Therefore, every foreign loan agreement should be entered into with caution.
Wakeel Khan
Rawalpindi
from The News International - Newspost http://ift.tt/2FFzQvB
No comments:
Post a Comment