Hafeez vows to go after tax dodgers
ISLAMABAD: Finance Minister Abdul Hafeez Shaikh told the National Assembly on Friday the government would go after tax dodgers it had already identified as the house began voting on demands for grants in the new budget.
Winding up the general debate on his Rs2.77 trillion budget (not Rs7.7 trillion as inadvertently reported in our debate story on Friday) for the fiscal year 2011-12, he urged parliament members to set an example in paying their taxes as he also
appealed to all rich people like industrialists and “media moguls” to carry out this “national duty”.
Noting that only about 1.5 million people in Pakistan were paying their income tax, he said the tax authorities had identified 700,000 more potential taxpayers on the basis of their lifestyle. “We will go after these seven lakh people,” he said, adding: “God willing we will give results.”
The 10-day general debate on the budget, which Mr Shaikh unveiled in the house on June 3 amid a noisy rumpus by the opposition PML-N, had ended on Thursday after 142 speeches spreading over 35 hours, and the minister said the PPP-led coalition government would learn from what was said from both sides of the house and would also accommodate 20 “specific” recommendation out of a total of 66 non-binding recommendations sent by the Senate.
After the minister’s speech, the house discussed charged expenditure – which is not subject to vote – worth more than Rs7.347 trillion, before approving 77 of the budget demands for grants worth about Rs990.4 billion for various ministries and departments of the federal government.
The largest chunk of the charged expenditure, which some opposition members said should be subject to vote for the sake of transparency and good governance, was more than Rs6.199 trillion worth repayment of domestic debts, with other major money-gobblers being domestic debt servicing (Rs714.671 billion), foreign loan repayments (over Rs243 billion), foreign debt servicing (Rs76.3 billion), repayment of short-term foreign credits (over Rs36 billion), and external development loans and advances by the federal government (over Rs49.6 billion).
Other significant charged expenditure demands, some of which came under criticism like over Rs9 billion for Pakistan Railways for the poor performance of the system and for the staff, household and allowances of the president (over Rs482 million) for perceived increases, included Rs9 billion for grants-in-aid and miscellaneous adjustments between the federal and provincial governments, over Rs2 billion for superannuation allowances and pensions, and about Rs1.4 billion for election.
Voting on the remainder of a total of 137 demands for grants for ministries and departments is due to be held on Saturday, Monday and Tuesday, when opposition members are likely to move cut motions in order to raise discussion on the performance of the fund recipients.
In his speech, which cited some salient feature of the budget such as non-introduction of new taxes and abolition of some existing taxes and abolition of exemptions from general sales tax, Mr Shaikh complained about the attitude of unspecified “powerful lobbies” that he said were unhappy with measures aimed at self-reliance such as bringing to the tax net those who were out of it.
Informing the house that 700,000 new potential taxpayers had been identified on the basis of “best addresses” of their residences, more than two bank accounts, frequency of their foreign travel and non-possession of national tax numbers, he said the biggest responsibility was on the members of the house to pay their taxes to set an example. “We can’t ask for sacrifices by other people unless our own hands are clean.”
And he also had some political advice for the opposition to cooperate with the government in meeting the present challenges and if it were not possible, avoid confrontation.
Pointing out that other institutions such as the judiciary, media, the State Bank and other regulatory bodies were working without interference from the government, he said “we should allow this to work by controlling our stubbornness and ego” and added: “There are more things that united us than those which divide.”