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Electricity subsidy

August 01, 2013

IT is reported that the government intends to withdraw the subsidy on electricity and increase power rates. The government has already enforced increase in general sales tax and petroleum prices.

Besides, the value of the currency has been eroding. This has led to inflation as prices have gone up considerably high due to increase in the cost of production of goods and services.

This has badly impacted the purchasing power and market activities which are already sluggish. This is a bad prescription for economic revival and creation of employment opportunities.

It was expected that the new federal government would provide a cushion against the impact of the increase in prices due to bad governance of the previous regime but no relief has been given.

On the contrary, people are burdened with the increase in indirect taxes and price escalation. Even education is not spared.

The government must give priority to the welfare of the people by providing economic opportunities by reviving the economy by giving generous incentives and a fair taxation system.

Indirect taxes, especially in petroleum products and electricity distribution, should be withdrawn to decrease the cost of production and increase the growth and competitive edge in global markets.

The subsidy on electricity should not be withdrawn and increases in power rates be shelved as this will create a great commotion and further instability in the country.

A daunting way is to eradicate corruption and enforce taxes on all sources of income, including agriculture income.