ISLAMABAD: Prime Minister Imran Khan and his financial team on Monday participated in a talk show on Geo News and answered questions related to the tax amnesty scheme live on TV.Adviser to Prime...
ISLAMABAD: Prime Minister Imran Khan and his financial team on Monday participated in a talk show on Geo News and answered questions related to the tax amnesty scheme live on TV.
Adviser to Prime Minister on Finance, Revenue and Economic Affairs Dr Abdul Hafeez Shaikh, FBR Chairman Shabbar Zaidi and Minister of State for Revenue Hammad Azhar participated in the programme and explained the merits and benefits of the amnesty scheme.
Shabbar Zaidi said yes, it is possible to get benefitted by the tax amnesty scheme. He said if anyone wants to declare their assets in Pakistan, they will have to register with the FBR and to become a tax filer prior to declaring any assets.
Shabbar Zaidi said that no action will be taken against anyone who wants to avail the amnesty scheme.
He said that the people could declare their Benami accounts and no action would be taken against them.
He said "we have included two sections: (1) No proceedings will initiated (2) Confidentiality will be maintained. He said assets scheme was launched in 2018 but the FBR did not take any action and stopped proceedings.
"I can promise you all and if anyone has any problem related to this issue can come to me and we would certainly protect them."
Hafeez Sheikh said the installment process is also included in the scheme to facilitate people.
People who have been complaining for not having time, the installment process is for them but they have to declare their Benami accounts. He said the declaration in which the immediate transfer of money is not involved, then one has the option.
The Adviser on Finance said if the remittances sent from the Pakistani diaspora have already been taxed, they will not be taxable in Pakistan. He said because they are already in the tax system, so the money is white.
Shabbar Zaidi said the overseas Pakistanis should not be worried about the scheme.
Hafeez Sheikh said for example if a Pakistani earned money here in Pakistan without paying tax and went to England and now having one million pounds and wants to legalise his money, he can avail the amnesty scheme.
Non-custom-paid vehicles are not included in this scheme; however, a custom-paid but undeclared vehicle can be declared.
Hafeez Shaikh said the previous schemes benefited people who would cite any amount and whiten all their future income too and got exempted from tax.
The reduced generation of tax amount this year is because during the last year’s amnesty scheme, people whitened their future income and got exemptions on tax.
It would be fair for the people of Pakistan that everyone is confident that the amount being deposited in the bank accounts are the actual assets which are being whitened and that may not hurt our next year’s revenues.
Abdul Hafeez Shaikh: The exporters will not be taxed. But if someone is selling their products in Pakistan, like garments, that would be taxed. Our assessment is that garments worth Rs1,200 billion are sold in the domestic market generating only Rs7 billion tax, which is not acceptable to us. We are re-emphasizing that the exporter will not be taxed irrespective of the volume and we will assist him. We are subsidising power, gas and even loans for them and are not taxing their exports at all as they are very valuable to us. But our goal is to increase the revenue and we need your help for that as this small tax amount from domestic sales is not acceptable to us. As per their argument that the refunds might not get stuck up again, I and my team have made a commitment with them that as the budget is passed on June 29th, we will hold meetings with them and devise an automated system like in Bangladesh or China. Through the automated system, you will get a major amount from your bank or the State Bank and would not be dependent on the FBR. Allow us the opportunity to run this system and if it does not work, we will re-assess it in 3-6 month period.
Shabbar Zaidi: I want to explain the difference between the assets amnesty scheme and assets declaration scheme. The amnesty scheme provides immunity from the income tax ordinance offering exemption under income tax ordinance. This other law is assets declaration law, which is a different law which does not only include income tax but also all other laws, including FIA, Foreign Exchange. If a person fraudulently takes money to Dubai or elsewhere, he would also be covered under it. People are not understanding this if that amount is declared, it is bigger than amnesty scheme and covers both the default of foreign exchange and that of the FIA.
Minister of State for Revenue Hammad Azhar said it had clearly been mentioned in the Assets Declaration Ordinance, 2019 that whatever assets would be declared under the law would never be presented in any court of law or any other forum as evidence against those declaring their assets.
And as a precautionary measure, this data would also be secured in the Federal Board of Revenue (FBR). That means that data would not be available to the FBR officers in future.
He said there were some faults in the amnesty scheme, announced by the previous government: There was no need to present your cash in the banks for seeking amnesty; no ‘benami’ laws were in place before launch of the current assets declaration scheme; however, it was ensured that the data of those availing the amnesty was secured and they were not harassed by any official of the FBR or any other government agency.
The state minister said when he came to know that the FIA had a list of Pakistanis having properties abroad, the agency top officials were directed to make sure that those availing the amnesty scheme, or those who had mentioned their properties in the tax returns, were not harassed. He said he was giving an assurance to those intending to declare their assets under the current scheme that they would never face any difficulty in future due to this sharing of the data with the FBR.
Hammad Azhar said the market rates of immoveable properties i.e. real estate have mostly been higher that the DC rates. Now the government was re-evaluating the properties and issuing new DC rates. If someone wanted to re-evaluate his/her properties and declare under the assets declaration scheme, they could do so for their own benefit. However, if they do not do so, the government would not go after them.
The state minister firmly said that extension in assets declaration date would not be possible at all. The scheme has been in place for the last one-and-a-half months and there’s still one week to go. Those would be real unfortunate people who do not benefit from the current scheme. After expiry of the date, the government would seize all benami properties and send those deceiving the government to jails.
Hammad Azhar said the person who says he has three tonnes of gold, he could declare it under the scheme. He could also present it as stocking trade, and mostly such people could be gold traders.