Investor sentiments

LAHORE: Businessmen and trade organizations mostly question the corrective measures taken by the government and declare that they will hurt investor sentiments; as if there are scores of investors desiring to invest in our country.

Government officials cannot raid the traders’ premises to nab tax evaders as it ‘hurts’ investor sentiment. Some trade associations say that in case of any query, the officials should first contact them and they would ask their members to provide them with account details the next day.

This kills the objective of the raid, which is conducted to check the records instantly and find out any discrepancies. Accounts are not the only thing that officials want to check. They can also ask a shopkeeper or a trader about smuggled items stocked there. They simply ask them to provide the purchase receipt of the item.

They can then further their probe by asking the seller to show the import documents (if it was legally imported) and if it was smuggled, they could ask him to pay the due government levies and taxes.

But the matter does not go that far. The retailer says he has no receipt and he regularly pays tax under the government annual turnover scheme that has been in vogue for decades. The turnover regime is interesting; the retailer does not show any receipt or documented sales. The state has to accept whatever annual turnover the retailer declares and increase it slightly every year.

The government does not have the courage to ask retailers to keep proper accounts. When huge stocks in retail premises are questioned, the simple answer is that all goods were brought on credit.

It is because of this flawed system that we have not been able to document retail trade. If we cannot force traders to keep proper accounts, we can say goodbye to documentation. Industrialists similarly blackmail the state when it takes action against smoke emitting factories. They plead that they should be given time to rectify their shortcomings. This has been going on for decades. The number of factories emitting black smoke is increasing with time.

But taking immediate action against them would result in large scale unemployment and would ‘hurt’ investors’ sentiments. The state buys their plea but the fact is that more advanced, expensive and environmentally compliant factories are not being established in Pakistan because people get away by installing cheap smoke emitting technologies.

We have seen that smoke emitting vehicles regularly get challan chits and are penalized but factories operate fearlessly. The most disgusting aspect in this regard is that numerous manufacturing concerns are throwing their polluted (sometimes poisonous) water in fresh water channels like rivers, canals or in the sea in the coastal cities.

Most of these factories have been warned several times in the past two decades but every time trade associations plead to give them some time to continue with this illegal activity. And the request is accepted. The factories continue polluting water channels because they know that on the next raids they would again be rescued. The government has abdicated its writ fearing that asserting the writ would hurt ‘investors’ sentiments’.