PTI tax resolve

The unanimous passage of the resolution in the National Assembly urging the Speaker to form a committee to investigate allegations of non-payment of taxes by parliamentarians on 8th April must be lauded. The motion was moved by Asad Umer and six other members of the Tehreek-e-Insaaf (PTI) and sadly to say, was discussed on the sixth attempt of the party to discuss it in parliament.
Those who may consider that many tax scams would be unearthed as a result must take note of two major elements that would protect the majority of our parliamentarians who pay very little tax. First and foremost, it is well known that the source of income of the bulk of our parliamentarians is from agriculture and with the constitution disallowing the federal government from taxing farm income, making it a provincial subject, no tax fraud would have occurred in most cases. It may be recalled that both the PPPP as well as the PML-N parliamentarians had opposed revisiting this particular clause of the constitution while debating the 18th Constitutional Amendment. The MQM was the only party in parliament at that time that had made a dissenting note supporting taxing of the farm sector. Critics of MQM had however, pointed out at the time that the party had vigorously opposed measures to enhance documentation considered necessary to render the tax system fair, thereby protecting its own major support group. The PTI was not in parliament at the time and it is doubtful if this particular clause of the constitution is likely to be amended if the two national parties remain in majority in parliament as they are at present.
The PTI however, is in government in Khyber Pakhtunkhwa and till such a time as the party has sufficient votes in parliament to amend the constitution it has the option to impose and collect a tax on farm income at par with the tax that is imposed on all other incomes but collected by the Federal Board of Revenue.
Secondly, the reported substantial income and assets held by several of our parliamentarians abroad - from Dubai to America - are again not taxable in our country because of the double taxation clause. Thus if any Pakistani with assets abroad is paying tax to the country where the assets are held he/she is exempt from paying the tax in Pakistan. Thus Imran Khan's frequent statements requesting the government to confiscate his assets if any are held abroad are seen as political rather than reflecting on the tax system prevalent in the country.
Federal Finance Minister Ishaq Dar has made much of the publication of the directory of taxes paid by Pakistani parliamentarians for the first time ever in the country's history. This effort must be appreciated because it is indeed a step further in making our parliamentarians accountable to their constituents irrespective of charges levelled against Dar at the time for excluding the names of those parliamentarians who had not filed their returns. Be that as it may, the media had identified those whose names did not appear in the directory and published that list.
There is an urgent need to change the tax system to render it fair, equitable and non-anomalous. If past and present precedence is anything to go by then it is equally evident that neither the PPP nor the PML-N are likely to engage in reforms that compel their own members to pay taxes commensurate with their large incomes sourced to the farm sector or held abroad. Increasingly Pakistan's bilateral and multilateral donors are expressing anger at the government for protecting the rich and influential through a flawed tax system while relying on resources generated by their taxpayers to meet our development and current expenditure needs. In short the time for major tax reform and not simply cosmetic reform is now but the incumbent government's commitment remains suspect after the withdrawal of several budgetary measures for political reasons.