The Ripple Effects of Pakistan’s Unstable Economy on Its Aging Population
The Ripple Effects of Pakistan’s Unstable Economy on Its Aging Population
Pakistan’s economy has been a subject of intense scrutiny and concern, particularly due to its instability and the repercussions it has on various segments of society. The middle and lower-middle classes, along with the elderly, bear the brunt of economic fluctuations, which starkly contrasts with the situation of the elderly in the West, who benefit from robust Social Security systems.
The Plight of Pakistan’s Elderly:
In Pakistan, the economic instability has led to high inflation rates and a sharp rise in the cost of living, which disproportionately affects the elderly. The lack of a comprehensive social security system means that many older adults rely on their savings or family support, which can be precarious, especially in times of economic downturns. The middle and lower-middle classes, who are already stretched thin, find it increasingly difficult to support their aging family members.
Contrast with the West:
In contrast, the elderly in Western countries often have access to Social Security benefits, which provide a safety net during retirement. These benefits are designed to ensure that older adults can maintain a decent standard of living, even if they no longer work. The system is funded by current workers and employers through payroll taxes, ensuring a continuous cycle of support.
The Tax System’s Role:
A significant factor contributing to the lack of social security in Pakistan is the tax system. The country’s tax-to-GDP ratio hovers around 10%, indicating a narrow tax base and low tax collection efficiency. This insufficient revenue collection impacts the government’s ability to provide public services and social support. The complex tax system, with more than 70 unique taxes administered by at least 37 agencies, leads to inefficiencies and a lack of public trust. Consequently, many Pakistanis are reluctant to contribute to a system they perceive as not providing adequate returns.
Moving Forward:
For Pakistan to address these challenges, it must reform its tax system to be more efficient and equitable. Expanding the tax base and ensuring that the wealthy and sectors like agriculture pay their fair share is crucial. Additionally, the government needs to invest in social security programs that protect the elderly and vulnerable, drawing lessons from the West’s systems to create a sustainable model tailored to Pakistan’s unique needs.
Conclusion:
The unstable economy of Pakistan has far-reaching effects on its citizens, particularly the elderly, who lack the safety net available to their Western counterparts. To mitigate these effects, Pakistan must undertake significant reforms in its tax system and social security provisions. Only then can it ensure that the elderly can live with dignity and the middle and lower-middle classes are not overburdened.
M. Abid Hafeez
Director of information Technology
Odyssey Group of companies Pvt. Ltd.
abid.hafeez@odysseyanalytics.net
This enlightening article brings to light essential points about the lack of social security benefits and emphasizes shortcomings in our taxation system. In my perspective, the subsidies given to the wealthy elite is another contributing factor.
ReplyDeleteThe analysis succinctly highlights the severe impact of economic instability on Pakistan's elderly, especially in contrast to Western social security systems. It effectively points out the inefficiencies in Pakistan's tax system and the resulting lack of adequate social support. The proposed reforms to broaden the tax base and invest in social security are crucial steps forward. By adopting these measures, Pakistan can significantly improve the quality of life for its elderly population. Overall, the analysis provides a clear roadmap for addressing these pressing issues.
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