Dawn Editorial 2nd May 2024

Freedom to question

WITH frequently suspended freedoms, increasing violence and few to speak out for the oppressed, it is unlikely that the human rights situation in Pakistan will improve anytime soon. True, the country’s policy landscape, replete with weighty legislations and proclamations, presents a different picture. But officialdom has consistently failed to implement its promises. It is essential, therefore, for people to voice inconvenient truths and their concerns regarding usurped rights. The recently concluded fifth edition of the Asma Jahangir Conference, a two-day moot themed ‘People’s Mandate: Safeguarding Civil Rights in South Asia’, has become an important platform for such voices. This year, the conference highlighted repression in the country and called upon political parties to talk to each other, sign a charter of fundamental rights, and refrain from involving unelected quarters in their quest for power. It was encouraging to note that a vast tract of violations was discussed, indicating that those dedicated to civil liberties will persevere. Multiple concerns, such as internet restrictions, military trials of civilians, the need for parliamentary intervention, judicial helplessness in cases of enforced disappearances, expulsion of Afghan refugees and the oppression faced by minorities, women and trans people, were raised before a young and engaged audience.

Such platforms can play a pivotal role in building robust social development constructs that advance awareness and ensure the law’s application. While Pakistan’s youth is charged and concerned, it is largely misdirected due to a sociopolitical environment that discourages questions. Fora that encourage diverse opinions and highlight the fight for throttled rights are above politics. Pakistani society needs informed facts and a culture of tolerance to dilute polarisation. This is the path to a just social contract, in which powerful hierarchies can be challenged and public approach and state policies crafted for equal political, economic, civil, cultural and social rights. All aspects of human life and dignity must remain inviolable.

Published in Dawn, May 2nd, 2024

Engaging Riyadh

OVER the last few weeks, there have been several exchanges involving top officials and their Saudi counterparts.

At the end of Ramazan, the prime minister flew to the kingdom to visit the holy cities, while also managing a meeting with the crown prince. The de facto Saudi ruler had sent positive signals regarding his country’s investments in Pakistan. That mini-summit was followed up by the visit of the Saudi foreign minister to Islamabad last month.

Accompanied by several other ministers, the kingdom’s top diplomat once again reiterated his country’s desire to invest in Pakistan. During Shehbaz Sharif’s latest trip to Saudi Arabia, undertaken in connection with a World Economic Forum event in Riyadh, the prime minister again met Mohammed bin Salman, as well as several Saudi ministers. The vibes during these meetings were also positive, and the message was the same: Saudi Arabia wants to invest in the country.

At a time when the state is trying to resuscitate the economy, news of Saudi money coming to Pakistan can only be welcomed. Riyadh appears to be primarily interested in investing in agriculture, while energy projects were also discussed during Mr Sharif’s just concluded visit. As the Saudi commerce minister put it, the crown prince is “prioritising trade and investment in Pakistan”.

From here, it is up to us how we use this opportunity. We can either avail these investments to create local jobs and growth, or we can blow this chance just as we have squandered several earlier opportunities due to incompetence and political upheaval.

Thankfully, there appears to be a realisation at the top that we have to change our internal dynamics to attract foreign investment, and make Pakistan an attractive destination for overseas capital. Mr Sharif hinted at the need to cleanse our stables when, at the WEF event in Riyadh, he admitted that Pakistan’s revenue sector is “in tatters”.

Revenue is not the only area that needs improvement. Ending corruption and red tape, and ensuring a regulatory and administrative climate that prioritises ease of doing business are also important. It is hoped that the Saudi offers materialise soon, while other foreign investors, in the Gulf and beyond, are also invited to explore the opportunities in Pakistan.

However, it must be stressed that to pull in maximum foreign investment, a climate of domestic political stability is crucial.

Published in Dawn, May 2nd, 2024

Punishing evaders

THE FBR’s decision to block mobile phone connections of more than half a million individuals who did not file federal tax returns for the tax year 2022-2023 indicates that the agency is stepping up its campaign against evaders. The FBR has issued a legally binding Income Tax General Order to mobile companies to disable the SIMs of 450,000 individuals who had earlier filed tax statements but did not do so last year. It has identified the remaining more than 50,000 tax delinquents through third-party data on their expenditures and consumption patterns. The punitive action comes after the tax evaders’ failure to respond to notices and repeated reminders. But is this enough to ensure tax compliance? The FBR’s action appears to be largely limited to those whose names are already in its database. Many will justifiably ask what is being done to expand the tax base itself. Under the law, any person earning an annual income of Rs600,000 or more, or owning a 1000cc car or a house is liable to file tax statements. However, less than 2pc of the population (4.5m persons) had filed their returns last year, down from 5.9m a year earlier. Besides, a very large number of filers do not show taxable income in their statements.

That the FBR has initiated action against non-filers amid reports that only 75 traders have registered themselves under the recently announced Tajir Dost Scheme, a voluntary tax compliance arrangement for retailers, underscores the difficulty in expanding a very narrow tax base. And yet, despite the tax agency’s past failure to execute multiple effective initiatives to increase direct taxation to boost the nation’s present tax-to-GDP ratio of below 9pc — one of the lowest in South Asia — we must keep our fingers crossed. Indeed, Pakistan’s current political leadership is committed to implementing FBR reforms, digitising the tax system to plug leakages and eradicating corruption and massive tax exemptions to powerful business lobbies. The intentions are sound. But the government would need to go much beyond automation and an anti-corruption drive; a paradigm shift is needed to make the tax system equitable to attract private investment and spur economic growth.

In addition to bringing untaxed and undertaxed sectors such as real estate, agriculture, retail, and overseas remittances into the net, the government will have to curtail the number of indirect taxes and significantly reduce high tax rates if it wants to improve compliance. The abysmally low tax revenue as a ratio of the size of the economy is at the heart of one of the worst financial crises being faced by the country for the last two years. This problem cannot be tackled without broadening the tax net, and making the tax administration and regime conducive to investment and growth.

Published in Dawn, May 2nd, 2024

May 4, 2024

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