Islamabad: The Federal Board of Revenue (FBR) on Wednesday dashed hopes of any success in recovering the money stashed by Pakistanis in Swiss accounts.
Shahid Hussain Asad, Member, Inland Revenue (Policy), FBR, in a testimony before the Senate Standing Committee on Finance and Revenue stated that it was easy to grab headlines, but practically it was not so easy.
The committee, led by Senator Salim H Mandviwala of Pakistan People’s Party (PPP), is reviewing proposals for the federal budget 2015-16.
Responding to questions, Mr Asad said the US was the only country that got a breakthrough to have access to Swiss accounts of its citizens. Even Germany was nominally successful while authorities in France initially purchased some data regarding foreign accounts of its citizens but then gave up the idea on moral grounds.
Mr Asad said the only route to know about Pakistani citizens’ funds in Swiss accounts was under Article 26 of the avoidance of double taxation treaty that empowers a nation after signing the treaty to seek information regarding specific persons for specific reason but even that law did not allow to demand general information from Switzerland.
“Forget about Swiss accounts, we cannot secure general information from the UAE regarding investments by Pakistani in real estate there,” he said.
He said real estate companies published full-page advertisements in Pakistani media seeking investment from Pakistanis and the government had been seeking their data but they don’t cooperate.
In the presence of the entire economic team of the government except the finance minister, Mr Asad said the FBR had raided investment booths set up by UAE firms in Pakistan which they abandoned and disappeared, but the UAE authorities did not provide data.
He said the only hope would be when Pakistan joins a global forum after 2017 under which Pakistan could automatically have access to information about its citizens having accounts in foreign banks and they would have access to our system automatically.
Some senators were of the view that tangible success to broaden the tax net could be made unless Pakistan was able to bring back $97-100 billion stashed in Swiss accounts or elsewhere through illegal means, including tax-evasion.
“This is a lot of money and unless you make a serious effort to bring it back, Pakistan would have to depend on IMF doleouts,” remarked Senator Mushahid Hussain.
The committee noted with concern that despite clear and open hostile Indian position against China-Pakistan Economic Corridor (CPEC) and its cyber attacks on Pakistan’s assets, there were limited allocations for countering cyber attacks. They also deplored that no funds were allocated for National Counter Terrorism Authority (NACTA).
Planning Minister Ahsan Iqbal said land acquisition for large projects had become a serious political issue in the country and gave an example of Diamer-Bhasha dam for which barren and mountainous land for purchased at Rs4 million per acre and added that the government could not even afford to cancel these deals.
The committee recommended allocation of at least Rs100 million seed money for providing insurance to media workers with matching contribution from media houses to ensure that families of those killed or injured in the line of duty are taken care of.