Spearhead Opinion – 14.12.2018

After strongly resisting the appointment of the beleaguered opposition leader Mr Shahbaz Sharif as Chairman of the PAC the PTI finally gave in by executing a graceful u-turn and accepting whoever the opposition nominated. Mr Shahbaz Sharif currently under NAB investigation became the Chairman PAC. This opens the way for other parliamentary committees to be nominated so that the suspended legislative work can begin. If anything, Mr Shahbaz Sharif will be under intense observation as the PAC goes about its work. The opposition may think they have won and that the PTI has suffered a setback but the reality is that the PTI has realized the importance of a functioning parliament and acted in the interest of democracy and the country. This may pave the way for government-opposition negotiations and agreement to work together on major issues that face the country. It is democracy that has won.

The PTI does not have the majority to legislate on its own. In fact, we are probably going to see a period of governments with thin majorities that need the opposition’s support for important legislation. Hopefully the deep polarization will begin to end and parliament will see more debate and less bickering. The focus has to be on achieving political stability and the sooner the better.

The other indicator of future positive developments came from the PM’s address to the Pakistan Economic Council. He moved away from his threatening anti-corruption rhetoric to a rational view on wealth creation as the road to ending poverty. He said that the creation of wealth through legal means is a positive activity and added that the Chairman FBR, though a bureaucrat, shared his views. In this context he mentioned major tax reforms and ease of doing business measures. For too long wealth creation has been viewed as some sort of crime and the wealthy as suspects to be targeted by taxation and other institutions. Legal wealth creation obviously means payment of taxes and a total disassociation with money laundering and other unlawful activities and scams. Inherent in the PM’s statement is the threat to those sitting on or thinking of acquiring wealth through mega financial and real estate scams. In the backdrop the law will continue to take its course on the scams unearthed.

The PM’s statement is a breath of fresh air for the tax payers being hounded by petty officials on flimsy grounds by invoking out dated laws and regulations. Obtaining a tax number for a new business is a ridiculous process that involves the production of original ownership deeds or lease agreements and original electricity bills, multiple visits, long waits in queues even though it should be a simple on-line procedure. After all the CNIC has all your identity details. Simplifying the tax regime is an urgent requirement and the PM has rightly singled it out for action.

The quick court verdict on Ms Aleema Khan sets the precedent for doing away with prolonged NAB and FBR investigations that end in JIT’s and unending court procedures. The fine imposed on her though heavy solves the issue. This precedent could be followed in all cases and action taken without court intervention if the amount of fine and back taxes is laid down and not left at the discretion of any agency. As we know discretionary powers are the bed rock of corruption and misuse of authority. An extension of this process could be permission to bring funds held abroad into the country by paying all dues or by declaring the funds as taxable income and paying income tax provided you are a tax filer. There could be an upper limit on the amount that can be repatriated legally so that those beyond a reasonable limit have some explaining to do.

Many out of the box innovative steps can be taken provided there is resolve and a willingness to breaks the shackles of petty officialdom and out dated laws and regulations. The PM has sounded the right note and his team needs to follow-up forcefully and quickly. The country needs political stability and economic uplift and looking for dole-outs is not the answer as the PM pointed out.

(Spearhead Analyses are collaborative efforts and not attributable to an individual)