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Clinton Urges Pakistan to Tax Wealthy for Flood Relief

US Secretary of State Hillary Rodham Clinton answer reporters after a bilateral meeting at EU headquarters in Brussels, 14 Oct 2010
US Secretary of State Hillary Rodham Clinton answer reporters after a bilateral meeting at EU headquarters in Brussels, 14 Oct 2010
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U.S. Secretary of State Hillary Clinton Thursday urged the Pakistani government to boost taxes on the wealthy to pay for flood relief and other infrastructure needs. She spoke on the eve of an international meeting in Brussels on aid to Pakistan.

Clinton renewed the United States' commitment to continue flood-related assistance and other aid to bolster Pakistan in its efforts to deal with the flood aftermath and curb extremists.

But at a joint press event with European Union foreign policy chief Catherine Ashton in Brussels, Clinton said that Pakistan, and particularly its wealthy citizens, can do more themselves to deal with the country's problems.

The secretary said the international community can only do so much and that the Pakistani government must take "immediate and substantial" action to mobilize its own resources.

She said first among such steps should be "meaningful reforms" to expand the tax base.

"The government must require that the economically affluent and elite in Pakistan support the government and people of Pakistan," she said. "We have been very clear on that and I'm pleased that the government is responding. I know how difficult this is. But it is absolutely unacceptable for those with means in Pakistan not to be doing their fair share to help their own people, while the taxpayers of Europe, the United States and other contributing countries are all chipping in to do our part."

Clinton has made tax collections a major issue in recent foreign travels, arguing that many developing countries are harming their own long-term interests by failing to collect enough tax revenue from wealthy citizens for education and other social needs.

The secretary of state said Pakistan must also act to alleviate "crippling" power shortages that stifle economic growth and make life difficult for ordinary citizens.

Clinton spoke on the eve of a meeting of the "Friends of Democratic Pakistan," a grouping of more than 20 countries and international institutions aimed at boosting the Islamabad government.

The United States and European Union have each provided about $450 million in aid to Pakistan since monsoon rains flooded about one-fifth of the country earlier this year.

Pakistani officials and international banks say the aid will cover only a fraction of estimated relief and reconstruction needs.

EU chief diplomat Ashton, who will co-host Friday's Brussels meeting with Pakistani Foreign Minister Shah Mehmoud Qureshi, said a "safe, secure and stable" Pakistan is "manifestly in the interests" of the European Union, the United States and the world community.

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