News Analysis |
The United Arab Emirates (UAE) authorities have confirmed the details of 53 individuals who have invested in real estate along with copies of passports in 31 cases according to Geo News. They reported that the Economic Crime Wing of Federal Investigation Agency (FIA) had requested the Ministry of Finance of UAE for exchange on information about Pakistanis holding properties in the UAE on 15th November 2017.
Geo News reported that the Federal Bureau of Revenues (FBR) authorities have released an official document in which they published the confirmation. FIA officials have claimed that 31 Pakistanis have pumped around 60 billion rupees into 55 properties in Dubai. Geo News had earlier also disclosed that around 7000 Pakistanis have bought properties worth 1.1 trillion rupees in Dubai in the past decade and a half.
Pakistan Tehreek-i-Insaf has been raising the issue of offshore accounts since a long time. They filed the petition against Nawaz Sharif in the SC to probe into the Panama Papers leak. PTI chief Imran Khan has vowed to bring looted money to Pakistan if his party comes into power.
Pakistan and UAE had signed the Convention for the Avoidance of Double Taxation in 1993. According to Article 27 of the convention, both countries can request sharing of information from the other country. The federal cabinet had approved an amendment in the Article 27 to exchange details of people who are hiding money offshore. The UAE authorities were contacted for negotiations but they have not given a response yet.
Offshore wealth has been a huge headache for the Pakistani authorities since the black law that is exported through different channels seriously hurts the economy. Pakistan is already one of the lowest tax paying nations in the world even though the taxes in Pakistan are also one of the lowest in the world. While not all money stashed in foreign accounts has been earned through illegal ways, majority of the money is reported to be acquired through corruption.
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A German newspaper Süddeutsche Zeitung (SZ) released 11.5 million leaked documents in 2015 that contained the details of more than 214,488 offshore companies. The leaked documents were named Panama Papers because they were taken from the Panamanian law firm and corporate service provider Mossack Fonseca. The Panama Papers revealed that the then Prime Minister of Pakistan Nawaz Sharif owned 8 offshore companies.
Prime Minister Shahid Khaqan Abbasi had last month hinted that the government might offer a onetime amnesty scheme to people who have offshore accounts. He said this while speaking to Pakistani Economic Forum on 17th January in Islamabad.
The leaks lead to the Panama Papers case in the Supreme Court (SC) of Pakistan and eventually to the disqualification of Nawaz Sharif as the prime minister in its verdict on 28th July 2017. The SC also ordered the filing of three corruption references against Sharif pertaining to his alleged offshore properties. He was disqualified for being the chairman of a UAE based company named Capital FZE which is owned by his son. Capital FZE is another offshore company owned by a Pakistani in the UK.
Former Finance Minister Ishaq Dar in 2014 and FBR in 2015 had reported that Pakistanis have 200 billion dollars stashed in Swiss Bank accounts. The Chief Justice of Pakistan Mian Saqib Nisar took a suo moto notice of Pakistani wealth hidden in offshore companies. The hearing of the case started on 1st February 2018. The Supreme Court (SC) ordered the FBR to submit a report about the actions they had taken against the offshore companies after the release of the Panama and Paradise Papers, which revealed the details of the offshore companies owned by Pakistanis.
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Pakistani authorities had earlier contacted the UK authorities to get the details of Avenfield properties allegedly owned by Nawaz Sharif but they failed to cooperate. The UAE has also failed to cooperate so far even though multiple letters were written to them to give the details of properties owned by Pakistanis in the UAE. Economic experts believe that most countries don’t wish to part with the wealth brought to the country by foreign investors. They give a big boost to the economy and returning the money to the original country can create a big dent in their own economies.
Pakistan and UAE had signed the Convention for the Avoidance of Double Taxation in 1993. According to Article 27 of the convention, both countries can request sharing of information from the other country.
Prime Minister Shahid Khaqan Abbasi had last month hinted that the government might offer a onetime amnesty scheme to people who have offshore accounts. He said this while speaking to Pakistani Economic Forum on 17th January in Islamabad. Abbasi said that the move was, that to bring black money into Pakistan, lower tax rates will be offered to those bringing back their wealth to Pakistan. Legal protection will be offered from the National Accountability Bureau (NAB), Anti Money Laundering (AML) laws.
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Pakistan Tehreek-i-Insaf has been raising the issue of offshore accounts since a long time. They filed the petition against Nawaz Sharif in the SC to probe into the Panama Papers leak. PTI chief Imran Khan has vowed to bring looted money to Pakistan if his party comes into power. Another senior PTI leader, Asad Umar, lamented that offshore companies have no place in the civilized world.
These so called tax havens, secret bank accounts & offshore companies to hide ownership should have no place in the civilized world. They have facilitated the crooked to steal from the masses and hide their stolen wealth https://t.co/oJEXIYzjbz
— Asad Umar (@Asad_Umar) November 29, 2017