A Critical Analysis of Pakistan's Budget 2023-24: The Fiscal Challenges

Abstract

The paper presents a comprehensive analysis of Pakistan's Budget 2023-24 and its fiscal landscape, sketching the challenges and opportunities within its revenue generation, economic growth, and debt management. The primary challenge facing Pakistan’s economy is the gap between government revenue and expenditures. The country faces hurdles in tax collection, marked by a complex tax system, tax evasion, and discrepancies impacting the middle and lower-income classes. A mixed research method was used in conducting this study, analysis of fiscal data, extensive literature review, and consultations with economic experts. An in-depth analysis of Pakistan's revenue sources, inflationary trends, budget deficits, and global economic conditions was conducted. The results show a complex web of challenges in Pakistan's fiscal framework, the gap between revenue collection and government spending, high inflation rates, the imbalance between exports and imports, encircling tax evasion, and an intricate tax system. The paper offers a sequence of strategic reforms, emphasizing expense reduction, tax simplification policy, political and legislative reforms, and encouraging investment for economic stability. It also highlights the need for coordination among government organizations, strategies to attract Foreign Direct Investment (FDI), and endorsing Human Resource Development (HRD) for a skilled workforce. The analysis highlights the importance of reforms in the governance structure, taxation system, and spending to achieve stability and economic growth in the country.