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Pakistan and its current economic situation are used
as examples in these FAQs.

What is a MBBS bond?
A MBBS bond can be viewed as a mandatory payment for goods and services.
The bearer of these bonds would be entitled to significant formularized discounts
on the listed sale price/cost of goods and services if these bonds are used with a
cash payment. In the government sector, a consumer can pay in bonds instead of
cash, and the bonds will be worth double the amount of currency. In the private
sector, goods and services would be purchased with 15% in bonds and the rest in
How can these bonds be used? What are the benefits of using these bonds?
These bonds would be used to obtain reduced prices for goods and services
offered by the government and the public sector. These bonds will bring down
the cost of living for a household consumer and reduce production costs for
Who will sell MBBS bonds, and who will be eligible to sell bonds?
Unemployed and preferably educated people would be hired as MBBS agents.
These people would have, at least, matriculated. They would be required to
register with PMF for an annual fee of PKR5, 000. PMF would conduct an
intensive but short training course, and it would offer a 10% discount to agents
and assigned them a monthly quota of bonds worth PKR300, 000, which would
enable a bond agent to earn up to PKR30, 000 a month.
What if a person cannot pay the PKR5, 000 registration fee?
If a person cannot pay the PKR5, 000 registration fee, then his or her monthly
quota will be reduced by 50% until the agent has paid the full registration fee.
How do you control the artificially raised prices and subsidized prices of the commodities/services produced by private sector?
MBBS does not control the prices of the private sector; instead, it helps control
prices by reducing the cost of production by at least 50% and eliminating taxes
and import duties. Therefore, there is no artificial price or overprice in the private
sector, and each product or service will be cheaper than the artificial price if the
consumer uses 15% in bonds and the rest in cash.
Why pay for expenses that will be incurred in the future?
Purchasing bonds for future purchases will ensure that the consumer pays
reduced prices because the bonds are inexpensive and will buy products and
services with reduced prices.
Is there any financial incentive for this advance payment other than bonds?
No, there is no other financial incentive, and the consumer would get bonds
according to the prescribed sliding scale. However, consumers who buy bonds
during the discount period would receive more bonds for their money and be
entitled to waivers for import duties. In addition, they would be able to sell bonds
at a profit when the cost of bonds increases later in a financial year.
Does the purchase of PKR100, 000 worth of bonds entitle the consumer to any duty-free imports?
A person or business that purchases PKR100, 000 worth of bonds in the first
month of a financial but will receive 600,000 bonds to purchase goods and
services offered by the state year and is not entitled to import goods and
services duty free as the duty free option is only available by remitting 1000euro
to state bank and this option is only available in the first month of implementing
this system.
How will the government control the under-invoicing of goods and services?
People under-invoice in order to evade duties and taxes. There will be no need to
under-invoice when custom duties are almost completely waived.
People who invest PKR100, 000 receive extra bonds, or they have the option to import goods and services duty free; however, people who invest less do not receive these benefits. Why?
Incentives such as extra bonds or a waiver of duties are available to people
spending PKR100, 000. Although some people cannot buy this many bonds on
their own, groups of low-income people can combine their funds and buy low-cost bonds. Even if they cannot raise enough money to buy large amounts of
bonds, they will still receive a 30% to 60% reduction in their cost of living when
they use their bonds. In addition, a rich or clever businessperson can buy low-cost bonds and negotiate a 4% to 8% discount from a bond agent. He or she
would be able to sell these bonds at the lowest rate to people who are unable to
raise PKR100, 000 and retain the discount as profit. This process can be repeated
throughout the first month and result in high profits for the seller and low rates
for the buyer.
How can a government generate the same amount of revenue in subsequent years if bonds are valid indefinitely and are in circulation right from the very first day?
The use of bonds is not restricted to individual consumers. Traders,
manufacturers, importers, agriculturists, and corporate entities will also require
bonds for their day-to-day use. These bond users will buy and sell their
merchandise through the Pakistan Monetary Fund (PMF). Spare bonds can be
sold on the open market at a profit or surrendered to the government to obtain
duty-free options. Every year will bring more business and more industries will
be set up and for that reason more bonds will be needed
The use of black money in this system will not generate the same amount of revenue in subsequent years. What remedies are available to the government?
The government will invest black money or extra cash in high-tech companies,
big business, and land reforms, and it will receive a profit from these investments
every year. Therefore, the government will not have any need for black money
after the first year.
What is the organizational structure of PMF? How does it operate?
PMF will be a private organization selected by an open-bidding process. It will
be responsible for selling bonds through agents, collecting funds from agents,
and depositing these funds in government accounts. PMF will operate regional
offices, which will monitor branch offices in each city in their region. These
branch offices will be linked by the latest information technology and will be
located in the smallest village.
How will PMF ensure transparent operations?
In order to ensure PMF’s operations are transparent, the next three lowest bidders
will be appointed auditors for a fixed fee. In addition, in the case of fraud or
mistakes, these auditors will receive 50% of any penalties (i.e., 10 times the
amount involved) imposed on PMF. The government will be the fourth auditor.
Why will PMF need 10,000 offices with 50,000 employees?
These offices and employees will be administrative in nature, which will ensure
smooth, transparent operations, and they will be responsible for maintaining a
record of bond sales. In addition, they will dispense bonds to bonds agents.
How will PMF monitor sales and control revenue collection from bond agents?
Each agent will have a monthly quota of 300,000 bonds. But the agent can sell
bonds beyond his or her quota of one month or can sell whole year quota in one
day to get as much money as he can and become investor by sharing the
commission with the investor instead of waiting for a year. This will ensure that
even a poor person will also get the 6 bond rate per rupee and will open a second
flood gate of money (SEE MULTIPLICATION EFFECT).
How would PMF eliminate or minimize the chances of bond agents committing fraud?
All PMF records will be computerized, and a record for each agent will be
maintained, which will reduce the chance of fraud or error. Any fraud or
complaint against any agent will result in the termination of his or her services.
The profits from fraud will be small, so most agents will not jeopardize their jobs
for small payoffs.
Currency is supported and backed by reserves. What supports or backs MBBS bonds?
Bonds do not need to be supported or backed by reserve currency because they
can only be bought with actual currency, if a person does not have the money, his
or she will not be able to purchase any bonds.
Who will print MBBS bonds, and how will they be kept secure?
The government will print MBBS bonds using the same infrastructure, standards,
and security measures used to print present currency notes. Large amounts will
be available as debit cards, which will add security, and coins for lower
denominations and notes for larger denominations will be available.
What will be the size, color, and denominations of MBBS bonds?
MBBS bonds will be in the form of debit card. Their denominations will vary.
What will it cost to print MBBS bonds?
Compared to the revenue generated by MBBS, the cost of making debit card is
negligible and according to rough estimate each card holding unlimited amount
of bonds will not cost more than 5 rupees,
The system looks very complicated and hardly possible to implement. Is this true?
MBBS might seem complicated, but even people with limited education can
understand it because it only involves two equations and is far simpler than the
present tax system, which is only possible to understand with the help of tax
consultants. In addition, the money system has been shifted from a binary system
to the decimal system, which is considered difficult to understand and implement
and used by very few people. Also, bonds agents will educate people about the
Will MBBS radically change Pakistan’s taxation system?
There will be no change in the tax structure (i.e., direct taxation) until and unless
the government is able to meet it revenue needs using MBBS. Until that time, the
tax system will remain intact. In addition, there will be no change in indirect
taxation; however, MBBS bonds will eventually be the only indirect taxation.
Is there a time limit on the waiver in custom duty?
The waiver of duty will be offered for a limited period of time. After a
concessionary period, this waiver will not be available, and the person or
business will be subject to the present duty structure. Category 3 businesses that
sell their products through PMF will be able to import duty-free goods or
services equal to the amount sold through PMF throughout the year.
How will this system help alleviate poverty?
This system will bring down the cost of living, and the necessities of life will be
available for 30% to 60 % less than current market prices. In addition, this
system will promote the creation of new industries and increased production in
existing industries, which will increase the number of available jobs. This will
definitely help reduce poverty in Pakistan. In a very first week, all unemployed
people (5 million) will be able to get job as a bond agent and earn a decent living
at no cost to the government.
How can a poor person obtain bonds at the lowest rates?
Groups of low-income people can combine their funds and buy low-cost bonds
during the discount period. In addition, for a security deposit of PKR100, a
person can buy bonds throughout the year for four or five bonds per rupee.
Will MBBS create real economic activity?
Yes. MBBS will produce an industrial boom because there will be no tax, no
duty, and production costs will be reduced by 50%. This will create jobs and
increase exports and reduce imports.
How will MBBS affect industry in Pakistan?
Pakistan could be an economic giant if its socioeconomic constraints are
removed. MBBS will remove these constraints and enable high-tech industries to
grow. This growth in industries will reverse Pakistan’s trade balance.
What benefits or incentives are available to a person spending PKR100, 000 to purchase bonds in the first month of a financial year?
A person spending PKR100,000 or( 1000 euro ) to purchase bonds in the first
month of a financial year will be having following benefits: (1) If a person does
not want bonds, he or she can receive a waiver of ten million rupees on import
duties for any legal imports, depending on the market rate of goods; (2) They
can receive 600,000 bonds for routine bills throughout the year; (4) they can sell
bonds for a profit at later stages once the concessionary period lapses; and (5)
they can enter a draw for PKR1000 million, which will be held daily .
What is the life of bonds? Do bonds have a due date?
There is no due date, compulsory period of use or expiry date for MBBS bonds.
All bonds will have an unlimited life and will continue in circulation in the same
way currency circulates.
What will the government do if the value of bonds drops to PKR0.1667?
The Government of Pakistan will intervene and buy back bonds at a cheaper
price and raise the price of bonds. This will not happen because bonds can be
surrendered for a duty-free option, provided 100,000 bonds are surrendered.
What effect will MBBS have on real estate?
MBBS will likely crash the real estate market because the profit margin for
bonds will be much higher than the profit margin for property; therefore, it will
be cheaper to build a house than buy one. It is estimated that it would could 50%
less to build a house under MBBS.
How will MBBS affect the stock market?
Initially, MBBS will crash the stock market; however, it will recover and rise to
new heights as a result of the elimination of taxes and a decrease in the price of
government-controlled essential goods. Ultimately, the stock market will cease to
exist because it is a form of gambling, and investing in bonds carries almost no
risk. In addition, this type of speculation or gambling is forbidden in Islam.
Does implementing MBBS pose any risks to the government?
MBBS is a unique, risk-free approach to revolutionizing the collection of
government revenue. It does not require giving up current taxes until the system
produces enough money to fund government activities. After that, MBBS will
transform Pakistan into an open, transparent, free market where the government
and citizens co-operate to drive prices down, create balanced budgets, and
increase general investment. Therefore, there is absolutely no risk to the
When will the government declare a tax-free holiday?
Once the government has collected enough revenue, it will remove all taxes. This
will further decrease prices. It is expected that the government will collect more
than PKR500 billion in the first 2 hours of a financial year because of the
incentives offered by MBBS, especially to people holding black money, which
will be the main source of revenue collected in the first month.
This system does not provide everyone with equal incentives. Why?
The system is designed to provide financial incentives to everyone. Everyone
will receive lower prices when using bonds and cash to purchase goods and
IMF puts many types of pressure on countries such as Pakistan. How will a country that implements MBBS deal with these pressures?
At present, the government is forced to borrow short-, medium-, and long-term
loans from IMF in order to finance cash imbalances, unplanned shortfalls in tax
revenue, and infrastructure development. MBBS will create a positive cash flow
for the government and lead to actual cash surpluses, which will eliminate the
need to borrow money and make it possible to repay current loans.
How will MBBS help establish Islamic banking?
The government must abandon all interest operations and use its cash surpluses
from MBBS to promote investment through co-operation and partnership with
the private sector. It would use surplus cash to establish and strengthen an
Islamic financing system. The government would provide cash needed to finance
this banking system.
How will MBBS support Islamic banking operations?
The banks in Pakistan will offer MBBS bond accounts. The banks would have to
establish special mandatory bond deposits. They would become as important a
seller of bonds as PMF. All investment in the private sector would be done
through banks, with 80% of the cash provided by the government and 20%
provided by the investor. The bank would be responsible for overseeing the
business, and the government would provide all commodities and services below
cost when the government is a partner in the business. The government would
receive 40% of the profit, and 60% would be divided by the bank and investor.
The state bank would oversee the whole lending process.
People and organizations may hold more bonds than required. Is not hoarding forbidden by Islam?
In Islam, hoarding is not allowed because of its practical effects on the supply of
critical items such as grain, water, and so forth. In MBBS, people would not be
able to exercise monopolistic powers because bonds would be freely available
from PMF agents and private sellers. In addition, the central bank could intervene
if banks try to manipulate bond rates. In this system, hoarding is not possible
because bonds would always be available from the government and the private
Will MBBS isolate Pakistan in international market? How will the government deal with imports and determine business relations with other countries under this system?
MBBS is an internal system, and imports and business relationship with other
countries will continue in the same way they do today. The only thing that will
change is the waiver of duties under certain conditions, which has nothing to do
with exporting countries.
WTO does not allow any subsidy and MBBS is based on subsidized prices. Therefore, how can the government implement this system?
Subsidy means selling at below-cost prices. In MBBS, cost price plus profit plus
bond value is actually the buying price. Therefore, there is no question of any
subsidy. In addition, abolishing direct and indirect taxes is not a subsidy.
How does MBBS compensate the government for the loss of revenue from reduced prices for commodities and the waiver of duties?
The sale of MBBS bonds would more than compensate for the loss of revenue
from reduced prices for commodities and the elimination of duties. In fact, the
revenue generated by MBBS would many times the amount of money collected
from the sale of commodities and duties.
What is the benefit of bonds to the general public?
Bonds would reduce the price of every commodity or service provided by the
government, and they would reduce the prices of goods and services provided by
the private sector by 40% to 60%.
How will it be possible for the government to collect PKR500 billion in the first 24 hours of a financial year?
According to conservative estimates, 10% of Pakistan’s population (i.e., 10
million people) would be willing to spend PKR100,000 in order to reduce their
cost of living by 40% to 60%, and this would generate more than PKR500 billion
(e.g., PKR100,000 x 10 million = PKR1000 billion). The remaining 90% of the
population would also use this system and generate even more money. Moreover,
people would purchase large number of bond in order to participate in draws
worth PKR 1 billion that will be held daily throughout the first month of a
financial year. Therefore, the government will raise more than PKR1000 billion
in the first month and five times this amount by the end of year.
How does this system support foreign exchange transactions?
Under MBBS, any person remitting money from abroad through legitimate
channels will receive 18 bonds for each dollar. This rate would vary according to
market conditions and would always be above the Hawala rate (at least 5%). This
incentive would eliminate the need for the Hawala system. The government
would sell surplus dollars to registered moneychangers at a slightly higher rate
(19 bonds per dollar). In this way, the public need for foreign exchange would be
met without any difficulty.
How does this system support foreign trade?
As discussed above, MBBS reduces production and business costs by 50%. In
such conditions, industrialists will have better opportunities for setting up new
units or expanding/modernizing existing units. The low cost of manufacturing
will make Pakistan’s products very competitive on the international market. Very
good quality products produced by hi-tech machinery and low prices will boost
exports and domestic consumption, and consequently, imports would be reduced
and Pakistan’s trade balance would improve.
Does this system benefit government employees?
MBBS would generate large amounts of money for the government, and as a
result, the government would be able to improve its salary structure (i.e., increase
salaries by at least three times present rates). This increase in salaries would
improve the financial situation of employees, which, at present, makes them
susceptible to corruption. Therefore, the level of corruption among government
employees would decrease.
What is the incentive for people with black money to participate in MBBS?
MBBS would enable people with black money to enter the legitimate economy
and import goods duty free and sell these goods through PMF. This would double
their profits and eliminate the risks associated with smuggling.
Why sell saving certificates when selling MBBS bonds will generate more money?
In 2006, the Government of Pakistan printed 40 billion saving certificates and
offered them at an interest rate of 11.6%. If all these certificates are sold,
Pakistan’s internal debt will increase by PKR50 billion. MBBS bonds would
generate all the money needed by the government and would not increase the
government’s internal debt.
How will MBBS help a business that does not deal with customers?
This type of business can pay a registration fee of PKR100, 000 and buy bonds
every month at six bonds per rupee. This business can get 600,000 bonds for only
PKR100, 000. The higher the registration fee, the more cheap bonds a business
can purchase. The only condition is that the business must produce evidence of
business operations and prove the registration fee has been paid. More than one
business can pool their resources to take advantage of these cheap bonds.
How will MBBS help a business dealing with customers?
This type of business can pay a registration fee that is not less than PKR10, 000.
They can buy twice the amount of bonds collected from customers. For example,
with a registration fee of PKR10, 000, a business can collect up to 10,000 bonds
a month and buy 20,000 bonds at a cost of PKR3333, while collected bonds will
be replaced without any cost with new bonds. The collection of bonds will be
according to the business’ annual fee as shown in the bond table. With a
registration fee of PKR100, 000, a business can collect 100,000 shares and buy
three times the amount of collected shares at the rate of six bonds per rupee. The
higher the registration fee, the more bonds a business can purchase at the
cheapest rate. A shopkeeper would be eager to sell his or her merchandise for
bonds plus cash. The amount of bonds accepted by a shopkeeper would depend
on his or her needs. On the other hand, a customer would be more than happy to
purchase merchandise with the help of bonds because bonds would reduce the
price of merchandise because they have been purchased at a reduced rate.
How will MBBS affect the cost of living?
The cost of living will decrease as a result of the elimination of taxes, 50%
decrease in the cost of goods and services, and pay raises.
Will MBBS create inflation? Will people buy more goods and services than they need?
MBBS will not create inflation because this system will result in a decrease in
prices. It is true that with MBBS people will have more money to buy more
goods and services, but that does not mean they will buy more than they need to
improve their standard of living.
If a business uses MBBS’ duty free option to purchase a 40 lakh rupee car for 12 lakh rupees, what will prevent it from selling the car for 40 lakh rupees?
When a business imports a 12 lakh rupee car using MBBS and tries to sell it for
40 lakh rupees, no one will buy it because they will be able to import the same
car for 12 lakh rupees.
How will MBBS help low-income people?
Any person who uses government goods or services (e.g., travelling by railway)
can use MBBS bonds to obtain substantial discounts. For example, a railway
ticket to Karachi may cost 400 rupees. In MBBS, the ticket may cost 800 bonds.
If the bonds are purchased for six bonds per rupee, then the ticket will cost two
thirds less than the cost to purchase a ticket using rupees. With bonds, a person
will be able to save 40% to 70% on government-controlled goods and services,
depending on the rate for bonds.
What is the cheapest price a person or business will be able to pay for MBBS bonds?
Bonds can be purchased for 16.67 paisa per bond, but this rate will only be
available in the first month of a financial year or if the buyer has a special
registration arrangement with PMF.
It has been suggested that MBBS can operate at the same time as a current tax system. How will this work if people have to operate under existing tax laws?
It would be necessary to enact legislation that safeguards the interests of a person
using bonds, and the government would not question a person’s source of
Has MBBS been used by any country?
To the best of our knowledge, no country has used MBBS to generate revenue
without interest. But the generation of revenue exists in every country by selling
interest based bonds with different conditions. So the system I am not suggesting
something new but the bonds are sold on incentive basis without interest
according to human nature.
How will MBBS affect the fabric of our institutional makeup in terms of conceding power, authority, and so forth? How long would it take to be universally accepted and agreed?
Authority tends to corrupt, and absolute authority corrupts absolutely. A large
amount of time would have to be devoted to not antagonizing people in power.
This is why PMF would be an autonomous institution. As soon as Pakistan
becomes economically self-sufficient and debt free, MBBS would spread like
wild fire.
It seems unrealistic to predict that MBBS will solve Pakistan’s revenue problems in 30 days. Is it not true that a project of this magnitude can easily take a few years to implement?
It can take several years to implement a system such as MBBS. In order to ensure
a smooth transition from the current tax system to MBBS, PMF will operate as
an independent system that operates parallel to the current tax system. Once
MBBS shows that it can work, the current tax system will become redundant. As
PMF is the back bone of the system and to establish PMF by bidding process will
hardly take a week because of huge amount of revenue at a stake (5 billion) and
recruitment another one week Making debit cards two weeks more . There will
be a heavy penalty clause if not completed in 30 days .As the saying goes
Can bonds be stolen?
Yes. The possibility of theft exists for any type of currency or bond. But It
cannot be used unless pin number is also stolen more over you can secure your
smart card with an identification code.
No marketing and advertising expenses have been mentioned during the discussion about MBBS. Why?
The 5 million bond agents would educate the public about the benefits of using
MBBS bonds. In addition, PMF would need to educate the public using some
television and radio commercials.