Tax amnesty at last | Pakistan Today

Tax amnesty at last

  • Does the PTI remember what it said about amnesty schemes?

PM’s Finance Adviser Hafeez Sheikh announced the latest tax amnesty scheme, the first of the present government, on Tuesday. When the previous government had brought an amnesty scheme, as it was fading out, the Prime Minister he is advising, Imran Khan, had castigated it as a scheme allowing the corrupt to whiten black money. Is this the motive of the present scheme? The impression is heightened by the fact that the present scheme is being brought in a mere ten days before the Budget, which was the natural point at which it could have been brought in, necessitating the use of a presidential ordinance to bring it about. When this mechanism was used by the previous government, Mr Khan was in the forefront of those alleging that this was done to avoid the scrutiny that would be made necessary by normal passage through Parliament, adding that this was done to prevent the exposure of those who were benefiting from the amnesty. Is it to be assumed that the same motive is at work in the present instance? Or does the fact that the amnesty follows so soon on the deal struck with the IMF, have anything to do with the matter? Be that as it may, the scheme was approved by a Cabinet which had shot down the one present by Dr Sheikh’s predecessor.

Quite apart from the questions raised by the amnesty, there is a different purpose announced. The Finance Minister was quite frank about the last amnesty: it was meant to raise revenue. The Adviser has announced different plans: bringing people into the tax net. The government having made benami accounts and properties illegal under the new Benami Law, owners of benami accounts and properties would have to choose between having them confiscated or entering the tax net. This might explain why the scheme has a cut-off date which coincides with the financial year. Afterwards, confiscations might go into effect.

Dr Shaikh may prefer more people coming into the tax net, but he will also hope for some revenue. Previous experience is not that encouraging. The fact that there is already a decline in revenue is another factor causing pessimism.