As we approach the 80th anniversary of the negotiations that led to the United Nations’ Universal Declaration of Human Rights, it is a good time to reflect on human rights and taxation. A country cannot be a human rights state if it only endorses civil and political rights (e.g. the US) or only economic and social rights (e.g. China). A cafeteria approach of picking and choosing the human rights to protect is incompatible with the Vienna Declaration. Here, we need to look at a little-known provision of the Universal Declaration, namely Article 29(1). It affirms: “Everyone has duties to the community in which alone the free and full development of [their] personality is possible.” — Is NZ Taxation Compatible with Human Rights? by Dr Jonathan Barrett, Newsroom, 9 June 2026.
For years, budget debates in Pakistan have been trapped within a narrow binary: either taxpayers versus the state, or the International Monetary Fund (IMF) versus sovereignty.
Article 29(1) of the Universal Declaration of Human Rights (UDHR) provides a more sophisticated lens. It reminds us that rights do not exist in isolation; they are accompanied by duties towards the community because human personality can develop fully only within society. This approach has profound implications for taxation.
Budget 2026–27, unveiled yesterday (12 June 2026), should not be judged merely by fiscal deficit, primary surplus or revenue targets. The real test is whether it advances a constitutional and human-rights-based fiscal compact in which both rights and duties are shared equitably, and public resources are deployed for the free and full development of every citizen’s personality.
The answer is a big NO.
The federation, as in the past, has increasingly relied in the proposed budget for the coming fiscal year 2026–27 upon unbearably oppressive petroleum levies, withholding taxes and indirect taxation, while simultaneously demanding provincial cash surpluses under IMF programmes.
The result is that revenue extraction expands, but corresponding public services remain weak. The social contract becomes unbalanced. Citizens perform their duties; the state struggles to fulfil its own.
The dominant neoliberal discourse treats taxation as a confiscation of private wealth. The social-democratic tradition sees taxation as the price of civilisation. Article 29(1) of the UDHR goes one step further: taxation becomes an expression of social obligation.
Citizens have duties towards the community; the state has corresponding duties to utilise public resources in a manner that advances the collective welfare and enables the full development of human personality.
A country that spends more on servicing debt than educating and healing its people cannot plausibly claim that human development constitutes the centrepiece of public policy
Under this framework, the first question is not whether taxes are high or low. The first question is whether the burden of civic duties is distributed fairly. In Pakistan, the answer is plainly negative.
A salaried employee cannot escape taxation. Corporate entities operating in the documented sector bear the overwhelming burden of direct taxes. Exporters face unjustified and exorbitant withholding taxes. At the same time, large segments of untaxed wealth, agricultural rent (unearned), urban land speculation, untaxed capital appreciation, privileged sectors and informal economic activity remain either undertaxed or completely outside the fiscal net. Finance Bill 2026 has nothing to offer in this direction.
Article 29(1) of the UDHR transforms this from a technical tax issue into a human rights issue. If duties towards the community are imposed selectively, then equality before the law is violated. Civic obligations cannot be the exclusive responsibility of the compliant.
The second question concerns the state itself. If citizens have duties, the state also has duties, and the foremost is contained in Article 3 of the Constitution: “The State shall ensure the elimination of all forms of exploitation and the gradual fulfilment of the fundamental principle, from each according to his ability to each according to his work.”
Taxation can only be justified when revenue is utilised to create conditions in which the free and full development of personality becomes possible. This directs attention towards education, health, housing, environmental protection, justice, public transport, local government, social security and economic opportunity. Here lies the central contradiction of Pakistan’s fiscal framework.
The Economic Survey 2025–26 itself provides evidence of this contradiction. The Survey celebrates macroeconomic stabilisation. Inflation has declined. The current account has improved. Foreign exchange reserves have strengthened. Remittances have reached record levels. The government understandably presents these developments as signs of recovery after years of economic turbulence.
The question, however, is whether stabilisation has translated into human development.
Article 29(1) of the UDHR does not ask whether inflation has fallen. It asks whether society creates conditions for the free and full development of human personality. The Constitution of Pakistan similarly does not confine itself to fiscal indicators. Articles 3, 9, 9A, 14, 25A, 37 and 38 require the State to create conditions that enable citizens to live with dignity and realise their potential.
The Economic Survey reveals how far Pakistan remains from that objective. Education provides the first example. Successive governments have repeatedly described education as a national priority. Yet the Survey shows that Pakistan remains among the lowest public spenders on education in the region. Public expenditure on education remains around two per cent of GDP despite constitutional obligations under Article 25A guaranteeing free and compulsory education. Literacy improvements remain painfully slow while millions of children remain outside the formal education system.
The State continues to demand sacrifices from taxpayers while failing to make corresponding investments in the most important determinant of long-term national prosperity.
Health presents an even starker picture.
The Survey acknowledges continuing challenges relating to maternal health, child nutrition, communicable diseases and access to quality healthcare. Public expenditure on health remains around one per cent of GDP—far below levels considered necessary even for basic universal health coverage. A country that spends more on servicing debt than educating and healing its people cannot plausibly claim that human development constitutes the centrepiece of public policy.
The position becomes more troubling when viewed alongside fiscal data. For years, Pakistan has succeeded in expanding revenue extraction through withholding taxes, indirect taxation and petroleum levies. The proposed petroleum levy target alone now exceeds the total development budgets of the centre and some provinces.
The Budget 2026–27 and Economic Survey 2025–26 should therefore be judged by a simple standard derived from both the Constitution and the Universal Declaration of Human Rights
Despite this, education and health continue to receive only residual attention. Citizens are told that there is no fiscal space for schools, hospitals, local governments and environmental protection, but there is always fiscal space for debt servicing and IMF-mandated primary surpluses.
The Survey’s chapter on social protection highlights another structural weakness. The Benazir Income Support Programme and related initiatives undoubtedly provide relief to vulnerable households. Millions of families depend upon them. The problem lies elsewhere. Pakistan’s social protection architecture remains disconnected from a coherent and progressive tax system.
In functioning welfare states, social protection is financed substantially through taxes collected according to economic capacity. Those possessing greater wealth contribute proportionately more towards the welfare of the community. Pakistan has chosen a different path. Untaxed agricultural rent, speculative gains in urban land, preferential treatments, tax expenditures exceeding three trillion rupees and vast segments of undocumented wealth continue to escape meaningful taxation.
Meanwhile, social protection programmes are increasingly financed through revenues collected from consumers and documented sectors.
This is redistribution without fiscal justice. The result is a peculiar social contract in which the salaried classes, documented businesses and ordinary consumers perform duties on behalf of society while many beneficiaries of economic privilege remain substantially insulated from corresponding obligations.
The Economic Survey also exposes another uncomfortable reality. The celebrated growth rate remains insufficient for Pakistan’s demographic realities. An economy growing below five per cent cannot absorb a rapidly expanding labour force.
Millions of young Pakistanis enter the working age every year. Employment generation continues to lag behind demographic expansion. Economic growth that fails to create sufficient opportunities eventually produces frustration, outward migration and social instability.
The survey, therefore, tells two stories simultaneously. The first is the official story of stabilisation.
The second is the largely unspoken story of underinvestment in human capabilities. The first story dominates press conferences. The second emerges from the data itself.
Viewed through Article 3 of our Constitution and Article 29(1) of the UDHR, the deficiency becomes obvious. The State has become increasingly efficient at demanding duties from citizens. Taxes are collected at source. Transactions are monitored. Petroleum levies are imposed. Advance taxes proliferate. Compliance burdens expand.
However, the same State remains remarkably reluctant to invest adequately in the conditions necessary for the free and full development of personality. The imbalance is not merely economic. It is constitutional, moral and political.
Economic surveys traditionally celebrate growth, exports, reserves and revenue collection. A genuinely rights-based Economic Survey would ask different questions. How many children received quality education? How many citizens gained access to healthcare? How many communities obtained clean drinking water? How many young people secured productive employment? How many families escaped poverty without dependence on state transfers?
These indicators reveal whether economic policy serves human beings or whether human beings merely serve economic policy.
The Budget 2026–27 and Economic Survey 2025–26 should therefore be judged by a simple standard derived from both the Constitution and the Universal Declaration of Human Rights.
Does the State demand duties according to ability? Does it distribute burdens fairly? Does it deploy public resources to expand human capabilities? Does it create conditions for every citizen to develop his or her personality freely and fully?
The evidence presented in the Economic Survey 2025–26 suggests that Pakistan has made progress on stabilisation but remains far from achieving that broader objective.
The tragedy of contemporary Pakistan is not merely that taxes are high or that debt remains excessive, which is a reality. The bigger tragedy is that citizens are repeatedly reminded of their duties while the State, controlled by an oligarchy, continues to postpone fulfilment of its own.