Slippery customers

It did not take long for some big fish to start wriggling once taxes appeared on the horizon. A parliamentary panel — not a body noted for its membership of paupers — has recommended that the government partially relax restrictions on those that do not file their tax returns (which is a majority of those eligible to pay taxes) relative to the purchase of property and new vehicles. The committee in a further frenzy of rich-person housekeeping also seeks to double the tax-free limit of cash withdrawal from banks to Rs100,000 per day. All this comes after the government has tried to introduce steps to broaden the tax base in the federal budget 2018-19.

Whilst there were aspects of the government’s proposals that the committee cautiously endorsed there was a determined attempt to create loopholes. Non-filers say the committee should be allowed to buy or import cars up to 1,000cc and not attract the attention of the taxman and purchase residential homes and plots of up to 10 marla or the equivalent in square yards. This sounds reasonable enough attached as it is to a rider that such moves would facilitate the middle-income group. That is an unknown as things stand, and the proposals are the thin end of a very wealthy wedge — get this through and there will be other opportunities to exploit. Butter was applied by a PTI senator who protested that whilst imposing limits of non-filers is in principle good, the government restrictions are too harsh.

It is difficult to find much by way of sympathy for the non-filers. For the first time in decades there is an attempt to squeeze fair dues out of them. They have exploited laxity and dithering for too long and a turn of the screw was always going to bring cries of pain. If Pakistan is ever going to drag itself out of the morass of indebtedness it has allowed itself to fall into then stinging tax reforms and their application is one of the few ways that the national debt can be reduced. No pain no gain, and slippery customers need to be netted.

Published in The Express Tribune, May 9^th, 2018.

Like Opinion & Editorial on Facebook, follow @ETOpEd on Twitter to receive all updates on all our daily pieces.