Newly Passed Tax Amnesty Scheme is A ‘License to Earn Black Money’

The National Assembly passed a scheme for open ended tax amnesty on Wednesday.

It will allow people to keep 97% of their tax evaded money, a move which tax and legal experts say grants a free license for earning black money.

The scheme can be availed at any given time and is not limited to a specific duration.

People who avail this amnesty need to pay a 3% penalty as advance income tax to legitimize the remaining 97%.

The bill, called the Income Tax Amendment Act 2016 was pushed by the ruling party PML-N, through the lower house of parliament.

The 3% tax is only for realty based income and does not apply to other sources of income.

Further Details

Standard maximum income tax on individuals is 35%. Failing to pay the tax within the given time gets a 100% penalty. You are then liable to pay 70% of your income as tax. Because of this new scheme, people will only be required to pay 3% of their income.

This tax amendment has the potential to destroy Pakistan’s tax infrastructure completely according to tax experts. This new tax amnesty schemes offers a stark contrast to the tax amnesty scheme approved in India on Tuesday.

Comparison With Indian Tax Law

According to the Indian tax law, people with untaxed income will have to hand over 50% of it to the government while declaring their wealth. They will have to give another 25% of their income in a fund made by the government for benefiting the poor. They can however get the 25% back in 4 years.

If tax officials find someone with untaxed, undeclared income, the culprit is liable to pay 85% of their income to the government, according to Indian law.

Ishaq Dar in his defence said that the new tax scheme cannot be compared to the Indian tax scheme which covers every source of income.

A Similar Law Was Passed Back in 1992

This is not the first time the government has helped legalize illegal/tax evaded money. In 1992 the government (also under PML-N at that time) introduced the Protection of Economic Reforms Act.

The FBR cannot inquire the source of money if it is deposited in a foreign currency bank account according to this act. This allowed businessmen, industrialists and bureaucrats to whiten their black money according to court records of that time.

A techie, Overwatch and Street Fighter enthusiast, and Editor at ProPakistani.

  • Insteading of nabbing corrupts this government is protecting them. May Allah’s has His wrath on theses corrupts and their savers. Ameen.

    • But Pakistani people don’t bother if the government is looting their money and then make such looting as Halal by passing such laws, they only want a motor way or metro to forgive such corruption, corruption is not an important issue for noon league voters.

      • Pakistani people are worst than animal. Even animals fight for their rights. Meanwhile our public unconditionally cheers up for their leader. People are not aware of what happens with present, future generations due to corruption and money laundering.

        Israel has 270 or something billions dollar of GDP. Meanwhile Pakistan is having over 300 billions USD GDP and millions of Pakistani working abroad sending billions of USDs each year. Still Pakistan isn’t half the way of Israel.

  • This tend to happen in Thug league’s Era! There are uncountable examples of their thuggery. Karz utaro mulk sanwaro being one of those. This time slogan little changrd, karz uthao mulk sanwaro. Shame on Gullu League.

  • Why amnesty for tax evaders ?

    Are they poor or can’t pay ?

    Very upset by this wrong decision

    Relief should be for tax payers not for cheaters

  • What can you expect from these blood suckers. To be honest, Parliament is the HIVE of blood sucking parasites which introduce rules that make blood sucking legal all over Pakistan.

  • NGOs, Qoum ko bhikari bananay walay ‘Falahi’ Idaray, aur degar bohat se logoun/idaroun ka kia hoga ab?

  • Such benefits should only be given to those who give income tax and file returns properly and diligently, not to thieves, looters and money launderers.

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