PMS Finance Adviser Hafeez Sheikh has defined the governments priorities in making the budget, which he spoke about while addressing a pre-budget seminar at the Islamabad Chamber of Commerce and Industry on Monday. Apart from the Value Added Tax (VAT), which Dr Sheikh once again said would be imposed, he also hinted at major rate changes in income tax without impacting low-income groups. However, he also admitted that there would be no levying of the agriculture income tax, saying that the provinces were independent about levying it. As for the governments priorities, he said that protecting economic recovery by maintaining fiscal balance was on top. However, he mentioned no measures that would even nudge the federal cabinet, and the federal bureaucracy it heads, towards some sort of reining-on, let alone full-fledged austerity measures which alone can lead to fiscal balance. The next priority is to check inflation. If that were indeed the case, the government would not allow the VAT to be imposed, because that will be a highly inflationary measure. Incidentally, there have not been sufficient assurances from the government that education, health and food products will not be subjected to this tax, and not only will imposing the VAT on these sectors be unprecedented throughout the world, but it will also be backbreaking for the citizenry. Dr Sheikh said that the poor people would be the third priority, and said that the budget would include targeted subsidies for people on or below the poverty line. Greater help for the poor would be to pass on the savings due to the lowering in international oil prices to the people, and to ensure that there will be a cut in mass transit fares, which the poor use to make their way to work. The PMs Adviser must not fall in with the temptation to use falling world prices to boost its own revenues. The other priorities mentioned by him included improvement of the tax-GDP ratio, one of the mantras spouted by the IMF to justify measures which would tend to destroy the Pakistani economy. Though Dr Sheikh said that budget could not be prepared under anyones pressure, it is known that the budget has been prepared under the dictation of the IMF, which is primarily concerned with Pakistans being obedient to the USA in its war on terror. If the budget was prepared in accordance with the wishes and needs of the people, it would not just mean a wholesale revision of the budget, but also a break with the IMF and the USA. There is not much time before the budget, but a people-friendly, people-driven, homegrown budget is possible, and must be produced.