Tax data and right to information
The Federal Board of Revenue (FBR), in compliance to commitment given by the Finance Minister to the Senate on January 7, 2014 that details of all parliamentarians would be made public by February 15, 2014, is still searching and collecting their data-even National Tax Numbers (NTNs) have not been issued to all of them till today. This exposes the assertions of FBR that it possesses reliable data of all the taxpayers and millions of rich persons not filing tax returns. Before the House Committees of Parliament in the past, high-ups of FBR made tall claims that nearly 3.4 million persons having luxurious lifestyle were not even enrolled as taxpayers. The question arises what action was or is being taken against them and why their data has not been published first?
According to a story published in Business Recorder of January 22, 2014, “FBR has already asked the National Assembly and Senate Secretariat along with all the four provincial assemblies to provide a list of parliamentarians, including their Computerised National Identity Card Numbers (CNICs) or National Tax Numbers (NTNs) for allocating NTNs to non-NTN holders by January 31, 2014”. It means that FBR has no data of parliamentarians till today! The story quoted some sources revealing that “FBR is trying to allocate NTNs to parliamentarians taking into account the nomination papers filed by the contesting candidates for elections-2013 with the Election Commission of Pakistan (ECP).” If FBR is relying on ECP, what is Pakistan Revenue Automation Limited (PRAL) doing? PRAL can leak data to journalists but cannot feed FBR, which owns this company – this is sheer mockery! All the winners of general election-2013 were required to file tax returns to qualify as candidates. If FBR is now differentiating between the non-NTN holders and NTN holders amongst parliamentarians, it means no exercise was taken at the time of elections even by ECP to disqualify defaulters. If some of the elected parliamentarians are non-NTN holders, it just exposes hollowness of the process of electoral accountability in Pakistan besides complete failure of FBR that we have been highlighting in these columns for the last many years – ‘FBR: the story of failed reforms, Business Recorder, Fiscal Review 2013.
The story further says that “on the basis of CNICs, the FBR will allocate the NTNs to non-NTN holder parliamentarians and deliver the same to them for becoming compliant taxpayers.” This exercise on the part of FBR confirms the contents of report ‘Taxation by Misrepresentation’, released jointly by the Center for Investigative Reporting in Pakistan (CIRP) and Sustainable Development Policy Institute (SDPI). The report claims that “out of 1,070 lawmakers voted to the national and provincial assemblies in the 2013 elections, 47 percent did not pay income tax and 12 percent of these members do not have a National Tax Number (NTN). Non-taxpayer MNAs are in all the major parties. The PML-N has the lion’s share with 54 such MNAs. PTI follows with 19 non-taxpayer MNAs. The PPPP has 13, JUI-F seven and MQM five. The PkMAP and JI have three each. The APML, PML, ANP and NP have one each MNA in this category” – http://cirp.pk/TAXATION%20BY%20MISREPRESENTATION.pdf .
The CIRP in its earlier 2012 report titled ‘Taxation without Representation’ exposed that “in both Houses of the Parliament, the Senate and National Assembly, there are 446 lawmakers and 300 of them have turned out to be tax-dodgers. Among them are those 88 MPs who do not have National Tax Number (NTN), let alone paying income tax. There are 16 MNAs whose taxes couldn’t be examined due to lack of basic information like NTNs and Computerised National Identity Card (CNIC) numbers – one Senator from the calamity-hit area claimed tax exemption and one National Assembly seat is vacant” – (http://www.cirp.pk/Electronic%20Copy.pdf). Obviously no action was taken on this report till the time new elections were held in 2013.
Article 19A of the Constitution of Pakistan says that “every citizen shall have the right to have access to information in all matters of public importance subject to regulation and reasonable restrictions imposed by law.” Explaining the scope and import of this fundamental right, added in the supreme law of the land through 18th Amendment, the Supreme Court in Watan Party & Others v Federation of Pakistan & Other PLD 2012 Supreme Court 292 [commonly known as Memogate Scandal] held that “Article 19A has thus, enabled every citizen to become independent of power centres which, heretofore, have been in the control of information on matters of public importance… Article 19A is a grant of the Constitution and, therefore, cannot be altered or abridged by a law enacted by Parliament…It, therefore, will not for this Court to deny to the citizens their guaranteed fundamental right under Article 19A by limiting or trivialising the scope of such right through an elitist construction whereby information remains the preserve of those who exercise state power.”
As our apex court has championed the cause of people’s right to information in PLD 2012 Supreme Court 292, it would be a legitimate expectation of the citizens of Pakistan that as a first step, the honourable judges of Supreme Court and High Courts voluntarily make public their assets and tax declarations as was done by their counterparts in India many years back. The high-ranking military and civil officials should also do it to counter criticism of the parliamentarians that they have been singled out in respect of disclosure of assets and tax declarations. If they do not come forward, FBR should do it in the form of a Tax Directory.
The nation has a right to know about the tax declarations of elected representatives but at the same time, the government as claimed by FBR must publish the names of all 3.4 million people who, being rich and mighty have not been filing their tax returns. The Federation of Chamber of Commerce has made a valid objection that publishing of tax data of those who are already paying taxes might expose them to extortionists but those who are not paying any tax will remain protected by FBR and State. This will certainly be a gross violation of Article 19A and 25 of the Constitution. Taxpayers shall not be discriminated against those who never bothered to even obtain NTNs, what to speak of filing tax returns.
Section 3 of the Freedom of Information Ordinance, 2002, says, “Notwithstanding anything contained in any other law for the time being in force, and subject to the provisions of this Ordinance, no requester shall be denied access to any official record other than exemptions as provided in section 15.” This statutory right, confined to official record, is narrow in scope. On the contrary, the Constitutional right is wide in its scope and gives right to access to information in all matters of public importance. The scope of Article 19A is explicitly highlighted in PLD 2012 Supreme Court 292 holding that “… the principle of law is that the fundamental right under Article 19A is a grant of the Constitution and, therefore, cannot be altered or abridged by a law enacted by Parliament”.
The starting point of implementation of Article 19A should be making public the declaration of assets, liabilities and taxes by judges and high-ranking civil and military officials. The civil society and media should come forward to force parliament to abolish all laws relating to secrecy and/or immunity and enact a comprehensive right to information legislation in the light of above judgement of the Supreme Court for compulsory disclosure of assets, liabilities and taxes paid by judges, generals and high ranking government officials – at present, such information cannot be obtained under Freedom of Information Ordinance 2002 whereas assets of politicians (though laughable) are notified in the Gazette of Pakistan.
Judicious and meaningful exercise of fundamental right guaranteed under Article 19A can make all the four pillars of the State – Legislation, Judiciary, Executive and Media – accountable to the public at large. Right to information in all matters of public importance, access to official record of FBR and other government departments (which is not secret) and free availability of what is owned by privileged classes must be assured. It will certainly help improve governance, democratic dispensation, transparency and rule of law. (The writers, lawyers, writers of many books and Adjunct Faculty at Lahore University of Management Sciences (LUMS), are partners in law firm, Huzaima & Ikram)