The federal cabinet on Wednesday endorsed and shared the concerns expressed by the Muttahida Qaumi Movement (MQM) ministers, who conveyed its reservations to the prime minister over the ongoing killing spree in Karachi and the “lack of commitment” of law enforcement agencies (LEAs) to arrest the killers.
Moreover, despite the Transparency International Pakistan requesting the Supreme Court to take suo motu notice of “two blanket tax amnesty schemes” being proposed by the government, the federal cabinet considered and approved controversial amendments in the Customs Act 1969, Sales Tax Act 1990, Income Tax Ordinance 2001 and Federal Excise Act 2005 to register non-tax filers in the tax net, paving the way for tax amnesty scheme tagged as registration and enforcement initiative.
A source in the federal cabinet told Pakistan Today during Wednesday meeting of the cabinet, MQM ministers informed their colleagues that goons of banned outfits were targeting people on sectarian basis and gangsters were killing their rivals, while law enforcers were acting as “spectators”.
The source added that the MQM ministers told Prime Minister Raja Pervez Ashraf that law enforcers were inactive on instructions from their high-ups and when they were allowed to act, they arrested a dozen target killers with large quantity of arms.
The source added that MQM ministers also shared with their cabinet colleagues some exclusive documents about criminal activities and extortion in Karachi.
Prime Minister Ashraf expressed serious concern over the Karachi situation. “We are all mindful of the fact that extremism, militancy, intolerance, sectarian violence and terrorism have posed a serious threat and challenge to our sovereignty, security and National Cohesion,” he said.
“As a nation, we have to thwart sinister designs of terrorists and the government would play its part in eliminating these elements,” he said.
Keeping in mind the sanctity of the Holy month of Muharrum, the prime minister said he had directed LEAs in all provinces to further beef up security arrangements, keep a vigilant eye and evolve a mechanism to maintain peace and harmony.
Interior Minister Rehman Malik briefed the cabinet on the situation in Karachi. The cabinet expressed serious concern over the law and order in Karachi and directed the ministry to make a detailed presentation to the cabinet in its next meeting and suggest concrete proposals.
The cabinet congratulated President Barack Obama on his re-election for a second term.
The PM said Pakistan and the US had common bilateral interests and shared regional objectives of peace, security and stability, hoping that as partners in a shared enterprise, they would be able to continue pursuing collective goals to the mutual benefit of both.
The cabinet later discussed and accorded its approval to the proposed amendment in Foreign Exchange Regulation Act, 1947 (FERA, 1947) and the Land Surveying and Mapping Bill – 2012.
In order to avoid any legal complication of important terrorism cases under trial, the cabinet approved, subject to vetting by the Ministries of Law and Human Rights, the Juvenile Justice System (Amendment) Bill, 2012. Necessary provisions have been incorporated for the protection of witnesses and juvenile accused persons in the proposed bill.
The cabinet considered and approved amendments in the Customs Act 1969, Sales Tax Act 1990, Income Tax Ordinance 2001 and Federal Excise Act 2005 to register non-tax filers in the tax net. The cabinet was informed that a significant segment of Pakistan’s economy was undocumented.
The growing size of the underground economy was not only depriving the national exchequer of its due share but was also acting as a hindrance for economic planning and development. A large number of businesses and individuals who were regularly filing their income tax returns were avoiding their legal obligations by either under-declaring or not correctly declaring their assets or income.
On the other hand, a large number of businesses and individuals who were required to be registered with the FBR and to regularly file their income tax returns were avoiding their legal obligations. The FBR, along with NADRA, has data about the multiple bank accounts, travels, assets and other details of these non-filers.
Based on this data, two tax incentive schemes were being proposed by the FBR. The past attempts by FBR to register them failed as the FBR field units unfortunately compromised the data.
The cabinet was informed that the Tax Registration Enforcement Initiative, 2012 has been devised to attempt through a simple scheme to register and bring into tax net non-filers of tax returns. A fixed tax is proposed and provides cover to undeclared income/assets of up to Rs 5 million.
The cabinet was informed that the Investment Tax Scheme, 2012 was being proposed to be enacted under authority given in the section 120A of Income Tax Ordinance 2001, which would attempt through a simple scheme to provide a mechanism and cover to regular filers in addition to non-filers of income tax returns to declare undeclared income assets/expenditure up to the value of Rs 5 million by payment of token tax and additional assets/income by payment of investment tax as per proposed slab.
The scheme would be administered through establishing special counters with the help of banks along with NADRA.
The Revenue Division secretary informed the cabinet that both schemes should not be taken as a safety net for those who had not complied with tax laws, but as a trampoline which would provide buoyancy to the national economy and deepen and broaden the tax base.
The people availing the schemes shall also have immunity under the National Accountability Ordinance, 1999, Federal Investigation Agency Act, 1974, Companies Ordinance 1984 and Foreign Exchange Ordinance, 2002. These schemes had been fine tuned based on discussions and feed backs from tax bar associations, trade bodies and the field units, he said.
The cabinet also accorded ex-post facto approval to start negotiations and signing of the memorandum of understanding (MoU) between the Foreign Service Academy of Pakistan and the Diplomatic Academy of Chile. It also considered and approved Election Laws (Amendment) Bill, 2012.
