News Analysis |
Information Minister Fawad Chaudhary has said that a special meeting of the federal cabinet has been called to discuss the proposed Assets Declaration and Amnesty Scheme. Earlier, it was expected that the scheme will be formally cleared yesterday but it seems that the governments want to undergo further deliberations. Fawad Chaudhary said that the cabinet members were not able to wrap up the discussion in one meeting hence it was extended for another day before it could be finally cleared for further action.
It is not the first time that a government has launched an amnesty scheme in a bid to help the slow economy with an influx of taxes which remain out of the equation due to multiple reasons. There have been several schemes of this nature launched in the past via multiple regimes and almost everyone missed the intended targets.
The incumbent Prime Minister himself was the beneficiary of the scheme as he declared the flats he purchased in London back in 1983/84 via an offshore company.
Imran Khan, the sitting Prime Minister of Pakistan, has been a vocal critic of amnesty schemes specially launched in the tenure of former government terming it as efforts to save the plunderers of the country. But given the state of the economy, apparently, Pakistan Tehreek-e-Insaf has once again decided to back off yet another principle stand.
Do these Schemes Really Work?
The history of Amnesty schemes to increase the tax collection and bring more people into the net goes back the time when General Pervez Musharraf took power after toppling Nawaz Sharif’s government. The economy was almost stagnate growing at merely 1.98 percent.
Read more: Imran Khan lashes out at PM over asset whitening scheme
Before the economy was somewhat stabilized by the Coalition Support Fund after U.S invasion of Afghanistan, Gen. Musharraf’s government decided to announce an amnesty scheme for Pakistanis to regularize their property abroad in exchange for a specific amount levied as tax. The incumbent Prime Minister himself was the beneficiary of the scheme as he declared the flats he purchased in London back in 1983/84 via an offshore company.
Since then, the PPP government announced two amnesty schemes in 2008 and 2013 respectively. But the impact was nominal for all these schemes and even those which followed during the tenure of PMLN government. In fact, Nawaz led PMNL government announced four amnesty schemes in the 5 years of power and all of them failed miserably to reach their intended target.
The PML-N government is fully facilitating the tax thieves to legalize their black money earned via corruption and illegal means.
To put things in perspective, the second amnesty scheme which Finance Minister Ishaq Dar expected to bring nearly a million low to middle tier traders into tax net was able to woo only 9000 beneficiaries. Therefore, the precedence does not paint a good picture with respect to the outcomes which such initiatives have brought in the past.
Political Suicide for PTI?
PTI has ferociously campaigned against amnesty schemes and all those statements are on record where Prime Minister and incumbent finance minister among other leaders severely criticized PMLN government for being complicit in the protection of the black market.
For instance, Dr. Yasmeen Rashid, current health minister of Punjab was reported saying that unfortunately, Pakistan is the only country in the world where tax thieves are rewarded, while the honest taxpaying class is penalized. The PML-N government is fully facilitating the tax thieves to legalize their black money earned via corruption and illegal means.
Read more: PML-N’s ‘volatile’ amnesty scheme is here to stay for another month
It is evident that PTI is government is clinging to every straw to keep the economy going as the situation is most likely to go worse. The aim of the amnesty scheme is to collect crucial money before the government announces its fiscal budget in a few months. However, given the precedence, the move is least likely to go in favor of the government and eventually approval ratings of government would go down further due to another U-turn.