For a larger tax drive

THE Central Board of Revenue wants to collect a lot more tax revenues and seeks the federal government’s assistance to maximize their revenues. Although the country and the government need a lot more revenues, the IMF, World bank and the Asian Development Bank are constantly prodding the government to achieve that.

The World Bank is only modestly satisfied with the progress of the reform programme and says it wants the CBR to exert far more to make the total reform package a success. It wants the cabinet committee on fiscal reforms to meet regularly once a quarter or on a half yearly basis regularly to monitor the implementation of the fiscal reforms. It wants particularly distinct improvements in project management as otherwise the good reform work done so far can slide back.

On the other side the CBR headed by Abdullah Yusuf is talking of a relentless drive to eliminate corruption from the ranks of its senior officers. Five or six big fish in the customs, income tax and sales tax divisions are to be eliminated despite the big political pull they claim. The Integrity Management Policy is to be applied against them with the approval of the president and the prime minister.

The chairman of CBR has also been talking of political interference in postings and transfers of senior officers to serve the political interests of the ruling party leaders and his efforts to resist such political meddling. There is also a move to reduce the posting period of senior officers of the CBR to two years at the end of which they will be automatically transferred.

Senior officers with proven corruption records will be removed from service under the removal from service ordinance. If adequate evidence is available against them they may even be sent to jail or be referred to the National Accountability Bureau.

Similarly there is a move to retrench a large part of the CBR officers and staff by using the Golden Handshake Fund of Rs 3.6 billion. About one half of this amount is a grant from the World Bank. The main purpose of the golden handshake scheme is to create vacancies to employ young, talented and trained staff in their place.

One factor which is delaying this process is the income tax dues deductible from the golden handshake amount. It appears that since 1997 tax has not been deducted from the golden handshake amounts including the privatisation cases. The CBR now wants to tax the payment that goes with the golden handshake.

Meanwhile, the CBR has come up with a blueprint for comprehensive tax reforms which is to be presented to President Musharraf for his approval by the middle of this month. It reportedly proposes taxing agriculture in a very scientific manner. It contains suggestions for increasing tax revenues through the next budget, including levying of taxes in the areas hitherto out of the net. The CBR team headed by Abdullah Yusuf would submit to the president proposals for broadening the tax base and measures to raise the tax-GDP ratio from the present low 10 per cent.

The CBR wants to inform the president about the ability of the agricultural sector to pay large taxes as it has a share of 24 per cent of the GDP. Suggestions about other potential areas like the real estate deals, capital gains from the stock exchange, which are exempted from taxation at present, and other areas in the service sector will also be placed before him.

The taxation authorities would however propose a lower level of taxations in the new areas and gradually step it up. The attention of the president would be brought to the sectors which pay far less tax than what they can pay and ask for authority for full enforcement of the tax collection measures.

Political interference in tax administration particularly the request for transfer or posting of taxation officers will also figure in the discussions as the CBR wants the authorities to resist such intervention. The CBR will also inform the president about the measures to deal with the non-compliant sectors.

The CBR has certainly brought some major reforms to facilitate tax payment and deal with taxpayers. It has its universal self-assessment scheme in place of the full assessment which is a radical reform. Beginning from the sales tax department it has spread to other areas particularly the income tax. Corporate tax payers find it easy to pay their dues to the large taxpayers unit in Karachi and Lahore and the medium taxpayers units in Lahore, Peshawar, Karachi, Rawalpindi, Quetta and Faisalabad.

Abdullah Yusuf who belongs to the private sector has done a great deal to improve relations between the taxpayers and the taxation department and reduce the need for contacts between them which breeds corruption. And if the reforms proposed by him and prompted by the World Bank go through smoothly the relations between the CBR and the taxpayers would be far better.

Payment of all taxes by the people depends on a number of factors beyond good relations. To begin with, the taxes should not be too many including the federal, provincial and local government taxes which until recently were 101.

The tax levied or increased should be generally acceptable to the people. The taxpayers should feel that it is not they alone but everyone, who has to pay the tax, is paying tax and is forced to pay or punished for not paying. If the large landowners will not pay income tax but the ordinary man pays 15 per cent sales tax for his essential articles of daily use that would not be acceptable. The people should not feel that the rulers, the law makers and senior officers do not pay any of the taxes.

The taxpayers must be convinced that what they are paying to the taxation officers does reach the coffers of the government in full. Mr Shahid Hussain, former vice-president of the World Bank who for a while advised the government on taxation reform had said that 40-50 per cent of the money paid by the tax payers did not reach the government coffers but went in to the pockets of officials.

The people want to ensure that they are getting in return for the taxes they pay good governance, law and order, good education, public health and environmental protection. So what matters is not only how the tax is collected but how it is spent . If it is misspent and there is excessive corruption in the government the people will be reluctant to pay full taxes. Headlines talking of official corruption discourages the tax payers.

How well the accounts of the government are audited also matters to the tax payers. If the official funds are misspent, wasted or embezzled the tax payers will be reluctant to pay the varied taxes. And if the Public Accounts Committee of the National Assembly deals with such scandals after a long time and cannot recover the lost money or punish the culprits, it is too demoralising for the people.

Government officials driving around in beaming new cars while the tax payers cannot get hold of a bus does not encourage the people to pay more taxes.

The political climate in the country is also a factor that influences tax payments or withhold the payment. Tax is paid more regularly in a stable political order with rule of law. The government cannot make people pay more taxes through rhetorical exhortation alone. Good governance breeds good practices and clean fiscal system.

Making an example of Saddam

PERHAPS the assumptions of the Pakistani mind regarding international politics are at times bizarre, as many of my American friends have often tried to convince me.

But no less wacky are the on-going attempts of the US administration and media — to convince the world that Saddam Hussein was hanged by a sovereign Iraqi government prodded by a revengeful Shia elite in collaboration with the ayatollahs in the holy city of Najaf after a due process of law.

John Burns and Marc Santora in the New York Times also persuade us that the Americans, concerned about the last-minute constitutional appropriateness of the execution, tried instilling wisdom in the vengeful Shia leadership.

Saddam was a tyrant whose brutality, megalomania and misjudgments devastated his people, wrecked the natural balance of power in the region and opened the floodgates of exploitation at the hands of western powers. If life has a system of doing justice he probably deserved worse, not better. But this is a moral judgment and that too against an individual. However Saddam, for reasons of history, represented an era and his final execution — just like his political end three years ago — warrants a careful analysis of the imperatives that led to it.

Notwithstanding the on-going efforts of the US and British media to explain his execution in the narrow context of a court trial and Shia vengeance, the world will continue to remember that the court that tried him was “created by a country which had invaded and occupied Iraq illegally; that this occupying power changed the laws of the occupied state in contravention of the Geneva Conventions; that the tribunal in question was ‘special’ and its jurisdiction was specifically tailored to adjudicate only certain individuals”; that many issues like the causes of the Iran-Iraq war were kept out of this court’s jurisdiction.

The world will remember that this court’s first judge resigned in protest against American interference in its proceedings and the second one was sacked by a puppet regime for refusing to obey its orders; that this was the first instance of a domestic court applying international law of “crimes against humanity”; that the International Criminal Court and the temporary tribunals that are trying war crimes in former Yugoslavia, Rwanda and Sierra Leone do not impose the death penalty; that the prosecution showed no intention to try Saddam for the second and more substantial case of genocide against the Kurds; that legal experts worldwide are concerned that the hasty execution of Saddam without waiting for the conclusion of the genocide trial is a serious setback to international law; that throughout Saddam remained in American custody and was handed over to the Iraqis for few brief moments only to be hastily hanged.

In other words, the world will remember that Saddam was hanged by a kangaroo court conceived, created and influenced by the illegal occupiers — the Americans — for the sole purpose of executing him after the trial.

Peter Baker in a rare article of its kind in the Washington Post argues that perhaps the revulsion that the senior Bush and his son, the current US president, had for Saddam helps understand the context of his ultimate execution. “I hate Saddam Hussein, and I do not hate a lot of people... I have nothing but hatred in my heart for him,” Bush elder once told CNN. Soon afterwards President Bush divulged his feelings about Saddam at a Texas fund raiser: “There is no doubt his hatred is mainly directed at us....after all, this is the guy that tried to kill my dad at one time.”

This personal animosity, this hatred definitely provides an important backdrop but there are certain other factors that need to be taken into account.

First, President Bush and his neo-conservative advisers, before the invasion of Iraq had advanced three reasons for this unprovoked war: the threat posed by Iraq’s alleged weapons of mass destruction; the alleged links between Saddam regime and Al Qaeda; and the crimes of the Saddam regime against the Shias and the Kurds. After facing the utmost humiliation on the first two counts, the whole thrust of the Bush administration for the past several months has been to justify an unjustifiable war of attrition against the Iraqi people on the pretext of getting rid of the tyrant Saddam.

The execution of Saddam thus provides a closure not for the Iraqi people but for the pro-war lobby inside the US that has finally got something, however immaterial it may be in a larger context, to cite as an achievement of this war. This assumes greater importance in view of the reversals the Republicans have suffered in the recent Senate and Congress elections.

Second, the US is fast receding as a superpower; it also looks increasingly troubled in the Middle East. The execution of Saddam should send a powerful message to the governing elite not only throughout the Middle East but as far as Africa and Central Asia that any nation or government adopting a deficient attitude towards America will pay a heavy price. Many minds in Islamabad, for instance, may now be a little more focused on the end game.

Third, Saddam’s execution and the carefully choreographed attempts at presenting it as Shia vengeance against the Sunnis may be taken as a strong signal that the US will now actively work to hasten the process of the “trifurcation of Iraq” into more or less autonomous territories in the north, centre and south.

Iraqi Shias and Sunnis fighting each other for political influence and power, with the US shaping the emergence of a pro-American Shia political entity in the neighbourhood of Iran and Saudi Arabia, was an important element that inspired the neo-cons’ vision in the run-up to the war. However, soon after the end of the war, when an estimated four million Shias marched to Karbala in April of 2003 the most common slogan they raised was: “Kalla, Kalla Amreeka- Kalla, Kalla Saddam (no to America, no to Saddam). Sami Ramadani, an Iraqi intellectual in exile in London, recently argued that it must have sent alarm bells ringing in Washington and London.

The subsequent political turmoil that developed in Iraq went through the stage of Shias and Sunnis fighting the Americans, from different platforms to the next stage where they were slaughtering each other. Intellectuals like Sami Ramadani argue that by deploying Iraqis against Iraqis to quell the insurgency — a process often referred to as “Iraqisation” and reminiscent of the Vietnam era strategies — Americans greatly facilitated a civil war-like situation.

On the face of its this continuing civil war scenario, with mindless violence, terrorism and sectarian murders, is a debilitating factor for the US administration. However, if examined closely, the same scenario greatly facilitates America’s continuing occupation of Iraq for three reasons: it focuses attention on the horrors of a situation that is defined and understood as a civil war between the sectarian and ethnic communities rather than the effects of a foreign occupation; it creates a moral justification for the presence of outside forces to fight chaos, as so often cited by Tony Blair to a sceptical British opinion, and it prevents Iraqis from waging a united political struggle against the Americans.

Many conveniently forget that the Americans conquered Iraq for the good of America and not for that of the Iraqis. Their charade of democracy was only in the hope that this tool might help their interests in the region by presenting them in a more favourable light.

Now if they become convinced that the best way of maintaining a strong foothold in a region of strategic interest to them is by letting Iraq split into three autonomous and rival zones, then so be it. Saddam’s dangling at the gallows apparently at the hands of a stubborn Shia, Kamal al-Maliki, certainly helps them move in that direction.

The writer is director of Media & Policy Analytics, London.

Three words people have forgotten

EVERY time one stops at the traffic signal in front of that three-pronged marble edifice in Clifton, Karachi, referred to as the Three Swords, one can’t help thinking, somewhat wistfully, how far the nation has strayed from the spirit underlying those three terse words enshrined on their surface — unity, faith and discipline.

If one’s memory serves one correctly, Mr Jinnah, who initially put together those three words, had, for reasons best known to him, stuck the word ‘faith’ in front of the other two. However, the person in charge of supervising the construction of the structure probably decided in a moment of enlightenment that ‘unity’ was perhaps the most important of the three nouns and went ahead and changed the order.

It didn’t make the slightest difference, because nobody really reads road signs and inscriptions on monuments. And this includes the people who put them up in the first place. If they did they would have by now corrected the spelling of one of the two road signs near the water tanks that guard the entrance to that cool, stone-walled cemetery beyond the Saudi consulate, with water from two tiny streams cascading down its beautifully manicured flowers and shrubs.

Gizri Boulevard, since the days of the first town planner who put his seal on the dismemberment of what used to be one of the more exclusive parts of the city, was always written as Gizri Boulevard — a spelling to which, one is sure, the Kalhoras and the Talpurs of Sindh would have given their assent.

But some enterprising road sign specialist, who must have been taking lessons in advanced phonetics, decided that in the second road sign of the same ilk the spelling should be changed to Ghizri Boulevard. Motorists and pedestrians are now invited to take their pick.

However, getting back to the inscriptions on the Three Swords, the authority that engineered the switch certainly had a point. There is enough faith in this country to move mountains, though it is probably not the kind of devotion that Mr Jinnah had in mind when he came up with the phrase.

A large part of the collective faith is currently being used for expressing dissent by disrupting mixed marathons, burning old tyres and smashing government and private transport. It has probably never occurred to the faithful that they could have played a major role in spreading literacy in the country by also using their houses of worship as centres of learning, and making people aware of their fundamental rights.

Getting back to the first word of the phrase, most analysts will concur that there is hardly any national unity in the country. In fact, the only time when the nation appears to be really united is when there is a war, or when the Pakistan cricket team is playing against the Indian team.

Pitting one’s skills against the West Indies or Australia doesn’t inspire quite the same degree of what Harold Nicholson referred to as Perfidious Albion — which in common parlance means — my country right or wrong.

But feelings in this country during the last few years have altered quite considerably towards India. This is probably because of the peace talks between the two nations, the numerous cultural exchanges that are taking place and the fact that when racially motivated attacks occur in the West, the inhabitants of the subcontinent develop a certain affinity and common interest motivated by the instinct of survival.

One is told that it’s very different in India, where there is a fierce sense of unity, and that a person is first an Indian, before he is a Hindu, Muslim or Christian and before he is a Gujrati, Punjabi, Bengali or wherever the person came from. This comes across in films, books and the stories that Pakistanis bring back from visits to Delhi, Mumbai and Calcutta.

Nevertheless, one didn’t get this impression when listening to the highly urbane and well-read former Indian petroleum minister Mani Shankar Aiyar, when he addressed an audience in Karachi on June 14, 2005, on the occasion of the launch of his eminently readable book The Confessions of a Secular Fundamentalist.

Aiyar stated quite emphatically that he was first a Tamil, then an atheist and then an Indian. It took a while for that to sink in, especially the bit about being an atheist. But so far as the reference to his province was concerned, the minister was on home turf. A lot of heads nodded knowingly. He had struck a familiar chord and the audience accepted the statement without question.

But in spite of what the minister had said, the general impression among the audience was that the minister’s views did not necessarily reflect those of the majority of Indians who still put nationhood before religion or province. In fact, Indians display a certain pride which is enviable. Aiyar’s highly stimulating talk did, however, bring out the difference between unity and nationalism, both of which appear to be in short supply in Pakistan.

There is no single cause for the lack of national unity in this country. There are instead a number of reasons which make the average citizen feel that the country has lost its moorings and is drifting on an unchartered ocean. Curiously enough, the perpetual sense of temporariness, caused primarily by the perceived threat from a hostile neighbour, the instability of the political system and the desire for wanting to live for the moment without a thought for the future, instead of binding together the nation, has had the reverse effect.

One of the consequences of this feeling of alienation is a strong sense of provincialism, which gives people of a particular province the excuse to accord preferential treatment to others from the same province. Another is tribalism which does not recognise provincial or national boundaries and extends beyond political frontiers.

Tribalism observes a rigid, often tyrannical hierarchy of command and a fierce sense of loyalty. It is the very structure of the clan that militates against a sense of national unity.

There appears to be a national obsession about wanting to know where a person comes from, especially when a surname, an accent or mode of dress does not adequately betray his origin. It is this fixation and belief that a person of a different ethnic background who speaks a different language can never be really trusted that has been the cause of so much strife in this country.

Curiously enough no government has ever tried to tackle this problem in the media. A series of talks by politicians, articles in the press and a sequence of plays on television exposing the dangers inherent in provincialism, and the recognition of merit instead of ethnic loyalty, would be a beginning.

The third word in Mr Jinnah’s phrase — discipline, appears to be the most problematical of the three, and yet it is really the easiest to enforce.

All it needs is a really firm hand and a resolve to enforce the rule of law without worrying about reprisals.

Indiscipline can be expressed in a number of ways. There is the more subtle form where turncoats switch political loyalties at the drop of a hat and people with influence take undue advantage of their position. And there is the more obvious form where everybody feels he has a right to break the queue.

People chuckle at stories of Pakistani expatriates queuing up like timid lambs at Dubai airport just before Eid and turning into British football hooligans the moment they arrive at Karachi airport; police mobiles driving the wrong way down a one-way street; motorists breaking traffic lights as a matter of course; and motor-cyclists trying to get into the Guinness Book of Records by competing for the number of passengers they can carry.

Since nobody seems to be interested in putting the country right, perhaps there is a need for a few more marble structures with the Quaid’s message inscribed on them. Who knows... somebody, somewhere might take notice.

Death on camera

“IT is curious, but till that moment I had never realised what it means to destroy a healthy, conscious man,” wrote George Orwell after witnessing a hanging. Proximity to death, which shocked him as a police officer in pre-war Burma, has been brought to the world in a different form at the start of 2007 through the images and sounds surrounding Saddam Hussein’s execution, recorded on a camera phone and released on the internet.

John Prescott, who has described the manner of the dictator’s death as “quite deplorable” in an interview with the

BBC, would not have been so outspoken had coverage been restricted to the official, edited and silent film.

Even in the still form used by some newspapers, including this one, after consideration, the second film has confronted the world not just with the brutish circumstances of Saddam’s death but the wider reality of present-day Iraq. Mr Prescott’s off-the-cuff response to it was authentic, just as Margaret Beckett’s initial statement that Saddam had been “held to account” (which Downing Street said came on behalf of the whole government) was inadequate. The new film of events at dawn inside the former offices of Iraq’s military security service has produced a more realistic understanding. The boundary between justice, however unpleasant, delivered by a responsible, sovereign government, and sectarian mob violence, was crossed in an explicit form.

The way in which the former Iraqi ruler died may not alter the underlying morality of his execution, an act which Britain should have opposed more firmly than it did and which was not universally supported even inside the Iraqi government, as President Jalal Talabani’s objections made clear. But the manner of Saddam’s death, ridden with chaos and malice, has made the act much more divisive and dangerous. It was justice delivered in its crudest form, by hooded men taunting Saddam with Shia slogans, the distillation of a fractured and lawless country. The possibility that the pictures were recorded by a senior Iraqi official, as Saddam’s prosecutor Munkith al-Faroon suggested yesterday, underlines the decayed state of what passes for central authority in the country.

The British government, like President Bush, still fails to acknowledge this reality, preferring Saddam’s trial and sentence to be seen as a clinical, judicial process carried out by forces over which they have no control. Mr Prescott appeared to object less to the manner of Saddam’s death than its public exposure when he said that “to get this kind of recorded messages coming out is totally unacceptable”.

He might have preferred the deed to take place behind closed doors, but even without the film the guards would still have jeered and Iraqi constitutional restrictions, such as they are, would have been pushed to the limit. So would Sunni tolerance. Their anger will be added to by Kurdish distress at being cheated of their time in court. The execution was hurried through after a trail for anti-Shia crimes but before the gassing of Kurds had even reached trial.

The pictures are shocking because they serve as a graphic conclusion to the terrible story of the rise and fall of Saddam, a story in which this country has played a part. For all the talk of Iraqi sovereignty, the former leader was tried by a special tribunal shaped by western forces, and was kept by the US until the final hours before his hanging. His body was flown to Tikrit on a US helicopter and US embarrassment over the bungling of his death has put pressure on the Iraqi government to investigate.

— The Guardian, London