- FBR Chairman in an aggressive mood
While FBR Chairman Shabbar Zaidi does indeed have a herculean task before him, of raising Rs 5500 billion in revenue, not just because it is needed if the annual Budget is to have any meaningfulness, but to satisfy one of the IMF conditionalities for its recently granted Extended Fund Facility, his approach, using old tactics, does not indicate that he will make the kind of difference he was expected to, when he was brought in from the private sector. His departure was so confidently predicted that a denial was needed from the Prime Minister’s spokesman, Naeemul Haque himself. That public display of support was followed by a tirade against smuggling, with a complaint that misdeclared goods were flooding the market, and thus depriving the government of revenues. Mr Zaidi did display the awareness that there was a need to minimise contact between the businessman and the taxman, but it must not be forgotten that the large number of nongazetted FBR officials who make such misdeclarations possible, have only been shuffled around recently. It should also not be forgotten that these officials will regard the Chairman’s exhortations as a licence to make more money, as they tell businessmen to pay more and pass on vastly reduced amounts to the government, having duly pocketed the difference.
The reason for smuggling is not so much misdeclaration as the local production of the goods smuggled in, and not at protected rates, but cheaper that the imported or smuggled goods. Mr Zaidi should be asking whether the government’s taxation structure, and its monetary policy, have created circumstances in which manufacturers will manage the kind of import substitution that will prevent smuggling. One reason this did not happen is that the PTI government so far has not seen fit to discuss this matter with businessmen, preferring to treat them the way it has the opposition.
The opposition is being treated as a bunch of the corrupt that cannot be spoken to. Similarly, the business community is being treated as the accomplice of previous regimes, fit only to have traditional methods of violence applied, and not as an important driver of development. Mr Zaidi will realise that there is no further squeezing of blood from a stone.
