KARACHI:
It is an internationally accepted norm that “it is not the business of government to do business” because the very concept of free-market enterprise is based on competition, equal opportunities, transparency, etc. Insider trading is considered a financial crime in all developed countries where there is rule of law. Unfortunately, when powerful individuals or state institutions enjoying immense clout and influence within the corridors of power get involved in commercial business ventures, it is unethical and irregular. Such conflicts of interest are not allowed in Islam, which was emphasised when Hazrat Abu Bakr (RA) on becoming Caliph discontinued his flourishing trade.
Revenue collection by the state is so low that salaries, perks and pensions of paid civil and uniformed employees are funded from foreign and domestic debts. In Pakistan, almost 65% of commercial business is owned by cartels registered as ‘trusts’ and ‘foundations’, enjoying tax exemptions, state subsidies, etc. This anomaly leaves about 35% of business enterprises that are subject to direct taxation. Foundations and trusts enjoying tax exemptions and subsidies should be non-commercial ventures. Paid or elected public office holders and institutions are not expected to do business while holding public office. There were 2.178 million individuals and companies in the Active Taxpayers (ATP) List for 2021, which is almost a 30% decrease from the 3.12 million ATP list for 2020.
Such financial irregularities and violations of established ethics have landed Pakistan into a crisis, which threatens the state’s capacity to protect its sovereignty under pressure from international donors and financial institutions. In the developed world, major cities are self-reliant and raise their revenues from tax collection and sale of lands, etc at prevailing market rates to fund their development budget, building roads/bridges, providing subsidised education and health to resident citizens instead of relying on federal doleouts.
Malik Ali
Lahore
Published in The Express Tribune, December 28th, 2021.
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