The period of tax amnesty scheme has almost come into the end, earlier which was announced by the former government, encouraging Pakistanis to declare their undisclosed income and assets. The government had also offered reduced rates to broaden the tax base and address the challenges to the economy.
The officials advocate in the favor of this scheme citing that there is no alternative when govt. wants to bring foreign assets into record. The government does not have access to the data or any mechanism to identify, seize and repatriate foreign assets of Pakistani nationals, so how does anyone intend to track these down?
They argue that the only way to locate these assets and arrange for their return, or at least their declaration against payment of an amount, was through voluntary measures. For the local assets though, the story was different.
While the reduction in personal income tax rate is welcome and will help bring more people under the tax umbrella, the amnesty scheme to whiten the black money is definitely a bad idea. It is basically designed to help the corrupt mafia, which encourages more corruption in the country.
The purpose of this amnesty scheme is to tempt the business community as part of its election campaign, just as it had done in the past.
Actually this tax amnesty is not about broadening the tax base, in-fact it is for the privileged few who don’t have a money trail and need to make their black money white and bring it back to Pakistan before authorities overseas enact tough, and due to new legislation, they demand the proof where their money, businesses and properties came from otherwise they sweep in to seize their assets.
Amnesty is akin to giving a way out to those who have conducted unlawful transactions, committed evasion of tax and laundered money, etc.