Hefty tax: diplomats in the firing line

The recent move by the government to impose upto 35% income tax on allowances and perks admissible to its public servants during their assignment abroad has come as a rude shock. Perhaps, the government did not realize that the overall impact of the move would not only demotivate diplomats but also degrade their living standards below poverty line abroad.

The tax will hit education subsidy, entertainment and health allowances. It looks that the government has not done any homework while subjecting a tiny minority who represents the state as diplomats abroad. These public servants, in any case, are paid mostly lower emoluments than the diplomats from countries of comparable regional and global agenda.

The move is un-precedented in the sense that no country has ever resorted to such berserk measures, especially in the wake of rising costs of living abroad. Their allowances have not changed since 2011 which in itself is unjust.

No doubt, in case of economic difficulties, it is the preserve of the government to take tough decisions and call for austerity. But the issue is whether the government is taking a wise decision or has gone for an unworkable and impractical measure. There are many other options and practices exercised by governments facing similar economic crisis. One option could have been downgrading of missions in countries where Pakistan has lower trade and cooperation. The other option could have been temporarily closing down embassies in small countries. The same countries could have been served from the headquaters by the respective area additional secretary or director general, notifying him/her as an ambassador. Another way could have been to move ambassador rank officers to the headquarter and let the next in command function as Charge de Affairs. In economic terms, all these commutations are workable but political costs would be dangerously high.

Another drastic measure the past governments had adopted was the closing down of embassies and consulates. Ironically, the same or the next government not only reopened the same missions but also added one or two more.

In today’s world and expanding foreign policy challenges, the close down option is neither viable nor advisable. In the past when we indulged in this game, the country suffered badly in terms of losing goodwill and friends. Reopening a mission is always a costly exercise. The safest course for the government is to withdraw the application of said tax on the allowances of diplomats.

If the intention is to treat every public servant equally, then firstly rationalise pay and allowances across the entire government including judiciary and military and later pay them in accordance with the nature and location of jobs. Already, the government works out its house rental on the location basis - higher in metropolitan cities, vehicles to customs and police services - job requirements etc.

These days public perceptions matter more than reality. The perception is that our diplomats are a pampered class that is overpaid but perform poorly. As the first line of defence, they have failed to stun the Indian onslaught and antics to isolate Pakistan diplomatically. As a result, the country is frequently maligned as a terrorist sponsoring state, unable to win over global diplomatic support for its national objectives such as the Kashmir cause and legitimate security concerns about Indian sponsored terrorist attacks in Pakistan. Also, it is held that our diplomats normally do not protect and promote the rights and the welfare of overseas nationals. Thrown in the same basket is the allegation that they hardly meet the common lot among them, only provide them consular services.

The litany of complaints does not end here. Another allegation is that they enjoy free education for two children, free medical facility for the family and hefty foreign allowance. The top leadership grudges tax exemptions on imports which the receiving country offer under Geneva Convention to diplomats, based on reciprocity principle.

The reality is that these perceptions hardly match ground facts. Not every glittering object is a piece of gold and this universal truth has been lost in the fog of fake and doctored perceptions and assumptions. The new truth is that all that glitters is all that matters. So one cannot escape burns from a non-existent fire. Those who don’t wear the shoe are not interested to know where it pinches.

Objectively speaking, as the first line of defence, diplomats assigned to advance national interests have to be given adequate wherewithal to deliver satisfactory results. The adjective “adequate” needs focused attention in diplomacy whether it relates to preparatory work or backup financial capacity to engage stakeholders in a meaningful way. None of the two are exclusive of each other, rather they are mutually reinforcing.

As far preparation for a meeting of any kind is concerned, it depends solely on the individual chosen by the government to represent itself. Our diplomats undergo rigorous training and generally the majority is second to none in intellect and diplomatic skills. Even Indian statesmen and former foreign ministers have praised their initiatives, brilliance, ability, and caliber. The second aspect relating to the backup support is beyond the individual diplomat’s capacity. In most cases, a winning brief is lost for lack of backup logistic support. The diplomacy is not science where 2 plus 2 is 4. It is a skill where a diplomat has to make his counterpart believe that 2 plus 2 could be 3 and his assertion is a win- win situation for both parties. The sophistication it requires to play a weak hand for a win requires constructs to distract an opponent. These charmful distracts require funds to entertain and travel to stakeholders. The nuanced game of diplomacy cannot be played effectively on the strength of logic, skills and principles alone. Any false assumptions about diplomatic work and its costs is bound to harm the capacity of those who carry out this job. “Biryani and dal channa” do not excite foreign counterparts. I remember while addressing an Envoys Conference in the ministry of foreign affairs ex-president Ziaul Haq said that whenever he invited an ambassador (stationed in Islamabad) and served biryani, the invitee loved it and hoped to be invited again. None ever declined his invitation, though no “mushroob” was served, he gleefully added. As a probationer assigned to do staff duty at the conference, I was pleasantly surprised when some senior colleagues, especially ambassador Shah Nawaz subtly exposed the naivety of the president by pointing out the huge difference between an invitation from the president of a receiving state and an ambassador.

It is understandable that the scale of backup support has to be determined foremost in the light of economic capacity of the country but must match efforts required to ensure realisation of the task assigned. In many ways, the revolution in technology has reduced communication costs and this development has benefitted cash starved sending states. Nevertheless, as the diplomatic work predominately involves personal contact and visits, the logistic and entertainment costs have risen and must be borne by the state. These allowances should be exempted from taxes as in the past. The foreign allowance vary from country to country as it is allowed to compensate for higher cost of living abroad. It is no luxury but a necessity to live with a semblance of respect abroad.

The Ministry is contesting this ordinance. Officers are in a state of deep shock because of the decision. It is hoped that the government would reverse the decision. After all, it is the diplomatic Corps which manages and conducts foreign policy of a country. They create options and space for the government at global level to best achieve its goals. It is upto the government to asses whether it can achieve its foreign policy goals with a dispirited and demotivated team. The short answer is no. Sooner the inadvisable decision is withdrawn, it would be better.

The writer is a former ambassador