THE controversy over the Value Added Tax (VAT), due to be introduced this Budget, had not yet died down, when further reports have added to it, as it became clear that Pakistan would place health and education under the VAT, and thus would become the first country to impose it on these sectors. The VAT has thus proved itself a true harbinger of disaster for the common man, who will find himself paying more for health and education, as well as all goods and services, because the VAT is supposed to be a pass-through tax, which is paid by the end-user, not the provider. The VAT seems to be following the sales tax as a detector of income, so that income tax may be levied on income so far concealed, but that method failed, and it is more than likely that the VAT will also fail before the creativity of the potential taxpayer and the cupidity of the tax collector. It is strange that developed countries have exempted their health and education sectors, but through the IMF are forcing Pakistan to impose the VAT on them. The state in these countries provides health and education of a sufficient standard for most citizens, even though vigorous private sectors in both fields allow citizens who prefer, to go to the private sector. In Pakistan, the public sector is of insufficient quality even to set standards for the private sector. Even citizens who really cannot afford it are forced to go to the private sector. It is falsely imagined that those in these sectors make exceptional money, on which they do not pay taxes, and which, if taxed, would yield vast sums. Even if this happened to be true, which it is not, imposing the VAT on these sectors would not raise their income tax yields, though both health and education, prohibitively expensive for the common man in the private sector, would probably go out of his reach. The VAT may well be an IMF conditionality carrying the Presidents personal promise, but it is an anti-people tax. Imposing it would be oppressive, if only for its inevitable inflationary effect, and to have it imposed on the health and education sectors would be to put salt on the wound. There is a way out, but the government would have to gather its courage to tell the IMF where to get off, and would also have to face the inevitable break with the USA. Both decisions would be popular with the population, which favours neither the new taxes proposed by the IMF nor the undue subservience shown to the USA. But the government so far has not shown much regard for the wishes of the people, and it is not likely to start now.