Rahat Fateh Ali Khan’s recent tax evasion scandal is a blatant example of how many musicians are evading taxes.
The legendary musician was summoned on June 6 to Lahore’s regional tax wing after failing to heed repeated notifications urging him to pay five years of arrears in taxes. However, in his defence, Khan claimed ignorance regarding Pakistan’s tax laws.
Many musicians are paid for performing concerts at home and abroad. And several of these globe trotting performers end up flouting tax laws, intentionally or otherwise, by failing to declare their income. Insiders feel that Khan’s case will be a warning to other musicians who routinely fail to pay taxes.
Singer Jawad Ahmed frankly explained that the majority of musicians, deliberately or otherwise, defy the country’s tax laws.
“Now nobody will evade taxes because artists will realise, if they don’t pay taxes on money earned abroad, they will be held responsible and it will be their fault,” explained Ahmed.
However, many people from the music community expressed their indignation over the issue.
A prominent singer’s manager, who wished to remain anonymous, said that Khan was an easy scapegoat for the authorities, following his arrest at Delhi airport in February for carrying undeclared currency. Therefore, the Pakistan tax authorities found it convenient to target the legendary singer in the aftermath of that incident.
The manager stressed that the government found it easy to collect taxes from artists, yet tax returns of powerful politicians and industrialists remain unaccounted for.
He also vociferously criticised tax laws regarding the entertainment industry.
“The taxation and overall regulation has been stifling the music industry,” he said.
Interestingly, Syed Ahmed, the Inland Revenue Inspector at Lahore’s regional tax office, actually confirmed some of the manager’s censorious claims. He said that the investigation into Rahat Fateh Ali Khan’s tax record was triggered by his arrest in Delhi. Consequently, the Pakistani authorities found out that Khan had not even registered for paying taxes.
While this demonstrates the rampant practice of dodging taxes in our country, it also reflects the inadequate effort by the government to hold the delinquents accountable.
When prominent artists were asked for their comments on the issue of tax evasion by musicians, they criticised the government instead for not adequately sponsoring the entertainment industry. They voiced many grievances about the alleged problems that they face in Pakistan.
Ahmed asserted that the culture ministry was nearly defunct because there was no minister heading it since it had been functioning under the ministry of information since several months.
Musician Mekaal Hassan also expressed his dissatisfaction about the dismal state of performing arts.
“In a year’s time, we are going to see the complete end of performing arts and music in Pakistan,” Hassan said emphatically. “No bands are playing and no one is releasing records. People are thinking of moving to places like Dubai, where they can have opportunities and security.”
He vehemently added that there was a wide misconception that music bands and performers were making hefty sums of money and hence needed to be held accountable for money owed to the government.
“Rahat Fateh Ali Khan is a big star, but the truth is that very few artists are really going off on foreign tours and making money.”
As Khan faces the music with the authorities, he should be at least comforted by the fact that entertainers and musicians are on his side.
Published in The Express Tribune, June 10th, 2011.
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