THE federal government has not achieved a consensus on the coming Federal Budget for 2009-10, with a lack of agreement on the new taxes to be imposed, and the enhancement of existing taxes and by how much. So far, it seems ministers are not ready to sacrifice pet projects. At the same time, the PM's Adviser on Finance is supposed to meet the IMF's target on the budget deficit, which is only possible by raising taxes. A budget always has two components, a spending requirement, and a revenue expectation. Both involve all kinds of policy decisions by the government, but Pakistan is at present faced with a more basic problem, that of making revenue match spending. While government wants the popularity that comes from spending, it does not want the public displeasure that is involved by taxation. This is the dilemma the government faces, and which has prevented agreement so far, even though ministers are not supposed to dispute so much, but should either accept the levels to which taxation will be raised or decide on spending cuts. The total budgetary outlay is expected to be about Rs 2.74 trillion, Rs 211 billion higher than this year, with the Rs 568 billion of development spending reflecting the Rs 600 billion approved by the Annual Plan Coordination Committee. With the members of the Cabinet unable to make up their minds, they should pay heed to the private sector, which has a wish-list for the Budget. This includes a cut in the General Sales Tax to 12.5 percent from its current 15 percent. However, these sources have also pointed out that there is a skewedness about the incidence of taxation which was harming industrial growth. It is noteworthy that Agriculture, which provides 20.9 percent of GDP, only paid less than 5 percent of taxes. On the other hand, industry, which contributed 25.9 percent to GDP, paid 75-80 percent of taxes. The services sector, which contributed 52.2 percent to GDP, paid less than 15 percent of the taxes. The coming Budget should provide pro-industry measures, which have been missing so far, and should also take care of the agriculture sector. At the same time, it should help those involved in the commerce of the country. But more than specific proposals, if the Budget process could help in the provision of assured electricity to industry, and could ensure the improvement of law and order, and cut the cost of doing business, it would be better. Consensus will be created on the Budget proposals, and there will be a Budget for the country. But will it ensure a recovery from the economic traumas of the past?