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June 14, 2019

Will govt stand its ground against pressure from influential groups?

Business

June 14, 2019

LAHORE: The track record of the present regime in withstanding pressure from influential groups is not very encouraging. That creates doubts about achieving budget targets, which needs brushing aside the interests of the most powerful segments of the society.

Take for example the case of the import of fast moving consumer goods. A few months back, the government made it mandatory that all fast moving consumer (food and medicines) items would have to print all information about the contents in Urdu in addition to the other language printed on the packing.

The rationale behind this condition was that most people in Pakistan cannot understand any foreign language and this deprives them of vital information about the adverse impact of the product on their health.

Moreover, they had the right to know the expiry date in their native language. Another condition imposed was that any edible item entering Pakistan should have minimum expiry date of six months.

his was done to shield the consumers from unethical imports of lots nearing expiry date that were bought at dirt cheap rate and retailed at original price. When these conditions were imposed, there was great hue and cry from not only the large grocery outlets but also from a few multinationals. After this decision hundreds of containers were struck up.

For almost two months the government refused to relent despite protests recorded by the affected stores through press conferences and large media advertisements. The government remained stubborn and officials of the ministry of commerce stated on record that there would be no compromise on consumers’ health and safety.

But after a while, all the consignments were silently released. Now, container after container is being released without following the imposed conditions, as the importers have been informed that the rules would apply from July 1, 2019.

The importers in the meantime would import enough to last for a year. One never knows if these conditions would be applied from July or not. It is very convenient for the rulers to withdraw public interest notification silently.

In the budget for 2019-20 the government has announced numerous measures that would be resisted tooth and nail by vested interests. For instance, the FBR has now been fully authorised to raid not only business premises, but the residences of those hiding or short reporting their incomes.

The FBR earlier had the authority to raid shops. When the officials started raiding some shops and business offices, the chambers and traders protested vehemently.

It was the present Revenue Minister Hammad Azhar who assured that these raids would be stopped, and they were. Now, the powers of FBR have been extended beyond business premises and will extend to the residences of businessmen as well.

Apart from bank accounts, the FBR can now peep into the bank lockers of the account holders. Would the same Revenue Minister muster the courage to withstand pressure from the businessmen against these raids? After all he also belongs to a business family.

Moreover, will the FBR officers limit their raids to those that do not see eye to eye with present government? Will the raids be across the board?

The scrutiny of lockers would pose a serious problem. The defaulting businessmen did not even tolerate the attachment of bank accounts to recover their defaults.

The present FBR chairman soon after assuming power ordered that officials take his permission while attaching bank accounts of businesses. These powers are still vested with FBR, but taking permission or warning the businesses about scrutiny of their accounts would mean few attachments.

Instead of such instructions, the new chairman should have set solid technology based parameters for attachment of bank accounts. Would he do it now?

This would require extreme courage, as many so called respectable persons of society would be exposed. Higher revenue can only be collected through ruthless rule-based efforts without mercy or favour for anyone.

The previous government withdrew the zero-rating facility of the exporting sectors. This government restored it after being convinced that it hampers exports.

Now, the facility has again been withdrawn. The exporters are exerting extreme pressure. Would the government accede to the pressure?

The revenue targets fixed by the government are extremely challenging. The economic planners boast that they have a roadmap to achieve these targets. Any deviation from the roadmap or a flaw in the plan would further distress the economy.

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