4
PAKISTAN’S history of financial scandals offers little hope of the Panama leaks’ controversy finally provoking a tightening of the noose around the rich and the mighty.
The ultimate fate of the once well-publicised cases such as the Haj scandal or the ephedrine issue offer nothing but disappointment over the final outcome of the matter now at the centre of daily headlines.
As key players in the scandals of yesteryear remain well beyond the reach of the law, there is ample fear that those at the centre of today’s controversy will ultimately go free.
But this history and the present-day context raise a compelling question: is it not time for Pakistan to force its national leaders to come clean on every little penny they earn including that conveniently locked away in their well-protected coffers?
The answer to this riddle eventually lies in coming to terms with a pathetically dysfunctional tax collection system in Pakistan, where the rich, the famous and the powerful routinely take it upon themselves to hardly ever pay their dues.
Dodging the taxman has tragically become a powerfully perpetual feature of Pakistan. To make matters worse, as the rich and the affluent fail to pay their tax dues, Pakistan lives with the added risk of being run into the ground with growing indebtedness that the country can ill afford.
Though Prime Minister Nawaz Sharif spoke out in defence of his two sons, both of whom along with their sister Maryam have been named as owners of offshore companies worth eye-goggling amounts, there is a risk of the ongoing frenzy eventually dying out.
What is essential is indeed a full public revelation of the paper trail, beyond Mr Sharif’s claim of the source of his children’s offshore wealth being proceeds from the sale of a family-owned steel business in Saudi Arabia. Ultimately, Pakistanis have a right to know if part or all of the money now in question was sent from Pakistan, and if so, after paying due taxes.
Beyond announcing the establishment of what has become a controversial choice of setting up yet another commission to probe the matter, the onus lies ultimately on the prime minister to come fully clean. His often noisy PML-N defenders have taken it upon themselves to vociferously defend their boss on one TV talk show after another, arguing that the wealth in question belonged to the children and not their father.
It’s clearly a hollow excuse. Across the world, any politician in a stable democracy with a family member similarly taken to task will themselves be taken to task too. And yet, the rules of the game in Pakistan are far from catching up with widely accepted democratic norms.
Across parliament in Islamabad or the country’s provincial legislatures, a quick glance around finds it hard to come up with a comfortable number of public representatives who either pay their tax or in fact the right amount. And to add fuel to fire proverbially, it is hard to remember a moment when those very representatives felt duty-bound to demand a comprehensive debate on fixing the country’s totally dysfunctional tax collection system.
Ultimately, news on matters like a pathetic public response to the Sharif government’s so called tax amnesty scheme this year should hardly be surprising. From time immemorial, Pakistan has witnessed no more than a below mere 1pc of the population paying their annual income tax.
There was a time when the heart of this debate surrounded the matter of landowners who remain exempt from paying their income tax. But in today’s Pakistan, the Urdu phrase ‘Iss hamam mein sub nangay hein’ (all are naked in this public bath) is indeed very apt.
From landowners to members of the prime minister’s supporters among businessmen and industrialists, there is little by way of a rapidly growing compulsion for people to pay their dues. Pakistan has become a country where the law is seldom enough to put the fear of a lifetime in well-connected individuals.
Mr Sharif’s own legacy, notably of creating laws which allow people to bring any amount of money from offshore to onshore foreign currency accounts, is indeed central to the problem. Thanks to the thriving hundi empire, there is ample scope for owners of illegitimate black wealth to conveniently funnel out money under the table to an offshore destination, only to be returned to onshore accounts for gaining legitimacy.
In recent years, Pakistan’s continuing battle with hardened militants has often been characterised as central to the country’s very survival. But tragically, Pakistan’s outlook is in continuous danger of heading southwards as its ruling elite refuse to fix a rapidly decaying tax collection system.
Ultimately, the powerful and sad reality of Pakistan is only one; It remains an increasingly impoverished state where the rich, the powerful and of course tax evading elite remain well in charge.
The writer is an Islamabad-based journalist.
Published in Dawn, April 18th, 2016
