Report on tax dodgers released, names named
By: Umar Cheema
ISLAMABAD: A majority of parliamentarians who generally refer to each other as ‘honourable member’ have turned out to be tax dodgers, a year-long study by the Center for Investigative Reporting in Pakistan (CIRP) has found.
Out of 446 members of the Senate and National Assembly, 300 did not file the tax returns. And those who submitted the income tax return statement have paid an insignificant amount that doesn’t match with their princely living standards and expenses.
Out of 126 tax return-filing lawmakers from both the Houses, only 15 paid tax above one million rupees and 68 paid below Rs100,000 each. All the MNAs and senators were sent a letter asking them for tax details. Only two MNAs, Pervaiz Malik and Arbab Muhammad Zahir, responded positively.
The NTNs and CNICs of the lawmakers were collected from their nomination papers and used for checking their tax information through sources with access to their data.
Prime Minister Raja Pervaiz Ashraf paid an insignificant amount of tax, Rs142,536, in 2011. Out of 54-member jumbo size cabinet, 34 don’t file tax returns. Prominent among them are Ch Pervaiz Elahi, Ch Wajahat Hussain, Haji Ghulam Ahmed Bilour, Rehman Malik, Nazar Mohammad Gondal, Farzana Raja and Makhdoom Amin Fahim. This 70-page report that contains all tax-related details of the MPs can be accessed through the CIRP website: www.cirp.pk.
The number of tax-dodgers has increased over the years. A study based on the 2008’s nomination paper record of the lawmakers conducted by this correspondent found out that 61% of them admitted in their papers having not paid a penny in taxes the year they contested elections. Of the remaining 39% taxpaying lawmakers, only nine percent paid tax above one million rupees.
Gilani, then PM, and his 25 cabinet members had paid zero tax, including present Finance Minister Hafeez Sheikh and Foreign Minister Hina Rabbani Khar. Gilani himself registered for NTN in July 2010.
The latest report “An Analysis of MPs’ Income Tax Returns for 2011,” authored by this correspondent has also mentioned the top-five and bottom-five taxpaying senators and MNAs. In the Senate, Aitzaz Ahsan is the highest taxpayer who paid Rs12,975,996. He is followed by Abbas Khan Afridi, Talha Mehmood, Farogh Naseem and Osman Saifullah. Mushahid Hussain is the lowest taxpaying senator as he paid Rs82 in 2011. Although, he mentioned the payment of Rs582 in his nomination papers submitted to the Election Commission of Pakistan, the FBR data disputes his claim putting the real figure at Rs82. Karim Ahmad Khawaja, Haji Saifullah Bangash, Naseema Ehsan, and Malik Salah-ud-Din Dogar are other four lowest taxpaying Senators. No political party has shown significant compliance with the tax laws making it mandatory to file the tax returns.
Jehangir Tareen is the highest taxpaying MNA with Rs17,053,172. Since he was an MNA in September 2011 when the returns were filed, hence he was considered for this study. He is followed by Hamid Yar Hiraj, Hamza Shahbaz Sharif, Attiya Inayatullah and Humayun Saifullah Khan. Sheikh Rohail Asghar of the PML-N is the lowest taxpaying MNA among those who filed the returns. He paid Rs16,893. Ghulam Murtaza Jatoi, Asim Nazir, Engineer Amir Muqam, and Rana Afzaal Hussain have followed Sheikh Rohail in the bottom-five list.
There are 88 senators and MNAs who still don’t have NTNs. Among them are included Commerce Minister Makhdoom Amin Faheem, Deputy Speaker National Assembly Faisal Karim Kundi, Senator Pervez Rashid, Aftab Sherpao, Faisal Saleh Hayat, Samina Khalid Ghurki, Zubaida Jalal and Mehboobullah Jan, who was declared the richest MNA in 2009.There are 35 senators and MNAs registered for NTN after their elections.
Prominent among them are Syed Yusuf Raza Gilani, Maulana Fazl-ur-Rehman, Zahid Khan and two ministers Sardar Bahadur Ahmed Khan Sehar and Khawaja Sheraz Mahmood. Although, Gilani is no more in the National Assembly, he was an MNA and PM in 2011 when the tax returns were filed and thus considered for the study.
The study has also made separate tables of the taxes of the key office-holders in parliament. There are 10 key-position holders in the Senate like the chairman and deputy chairman Senate and parliamentary leaders of different parties. Among them the highest taxpayer is Abbas Khan Afridi who paid Rs11,528,292 and Ishaq Dar the lowest taxpayer among them with Rs32,750. Deputy Chairman Senate Sabir Baloch didn’t file the tax return.
There are 12 MNAs holding key positions in the National Assembly. Among them, Dr Fehmida Mirza, Speaker National Assembly, is the highest taxpayer who paid Rs649,306 and Ghulam Murtaza Jatoi, the parliamentary leader of the National Peoples’ Party (NPP) is the lowest taxpayer who paid Rs21,993. Ch Nisar, the leader of the opposition, paid Rs153,940 as income tax in 2011.
The Pakistani elite class has been the biggest tax evaders. The report where it quoted examples from different parts of the world about the tradition of tax disclosure by the political leaders, it also sums up the tax history of Pakistani leaders. Right from Zia to President Zardari, no leader filed tax returns regularly. In the case of Zia, the report quoted his speech where he urged Islamic punishment for the tax evaders, it has also mentioned that tax authorities started investigation after his death and found that he never filed a return right from 1969 to 1988. His family was finally forced to do so.
These tax malpractices on the part of elite have discouraged the common citizens to pay taxes who already feel overburdened through indirect taxes. The low tax to GDP ratio has been a major revenue issue confronting Pakistan. Resultantly, its economy has long been dependent on foreign aid and loans.
The state is thus failing in performing the functions that it has assumed. Pakistan’s tax to GDP ratio is significantly lower than India (16 percent), Sri Lanka (13 percent), Indonesia (14 percent), Malaysia (15 percent), Thailand (17 percent), Philippines (14 percent), and South Korea (16 percent). It is even lower than Ethiopia (10 percent) and Afghanistan (9.4 percent). The National Assembly was informed on 7th June 2011 that Pakistan was second from the bottom among 154 countries on the tax to GDP ratio ranking.