Pakistan collects $967m through tax amnesty scheme

A Pakistani currency dealer counts USD banknotes at a currency exchange shop in Karachi on August 1, 2018. (AFP)
Updated 01 August 2018
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Pakistan collects $967m through tax amnesty scheme

  • Over 75,000 Pakistanis have availed domestic and offshore tax amnesty scheme
  • Pakistan intends to broaden its tax base from 1.2 million to 30 million individuals

ISLAMABAD: Pakistan’s government has collected $967.28 million through a tax amnesty scheme that allowed people to declare their hidden domestic and offshore assets by paying a nominal 2-5 percent tax on them.

The scheme was launched by the previous government on April 10, and was scheduled to expire on June 30. The caretaker government extended the deadline to July 31 to allow more people to benefit.
“We’ve had an overwhelming response from people in Pakistan and abroad. The tax amnesty scheme has been successful,” Dr. Mohammed Iqbal, a member of the Federal Board of Revenue (FBR), told Arab News. The scheme will not be further extended, he said.
More than 75,000 Pakistanis have made use of the amnesty, FBR officials said. But senior economist Dr. Athar Ahmed said the government was expecting at least four times more revenue than it collected under the amnesty.
“The potential target of this scheme were Pakistanis who have trillions of dollars in offshore assets, but the tax collection shows only a fraction of them have declared their assets through the scheme,” he told Arab News.
“Pakistan needs to introduce cogent tax reforms to bring the maximum number of people into the tax net,” he said. 
“Measures like the amnesty scheme are good in the short term, but provide no relief to the economy in the long run.”
Saqib Hameed, a tax expert who works for a consultancy firm in Islamabad, told Arab News that the amnesty “will definitely help improve Pakistan’s economy, as people who’ve benefited from the scheme have now become permanent tax payers.”
But such schemes are temporary measures, he said, adding: “The authorities need to initiate a wider crackdown against tax evaders and tax defaulters to increase revenue.”


‘Don’t be too optimistic’: Huawei employees fret at US ban

Updated 26 May 2019
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‘Don’t be too optimistic’: Huawei employees fret at US ban

  • This week Google, whose Android operating system powers most of the world’s smartphones, said it would cut ties with Huawei
  • Another critical partner, ARM Holdings, said it was complying with the US restrictions

BEIJING: While Huawei’s founder brushes aside a US ban against his company, the telecom giant’s employees have been less sanguine, confessing fears for their future in online chat rooms.
Huawei CEO Ren Zhengfei declared this week the company has a hoard of microchips and the ability to make its own in order to withstand a potentially crippling US ban on using American components and software in its products.
“If you really want to know what’s going on with us, you can visit our Xinsheng Community,” Ren told Chinese media, alluding to Huawei’s internal forum partially open to viewers outside the company.
But a peek into Xinsheng shows his words have not reassured everyone within the Shenzhen-based company.
“During difficult times, what should we do as individuals?” posted an employee under the handle Xiao Feng on Thursday.
“At home reduce your debts and maintain enough cash,” Xiao Feng wrote.
“Make a plan for your financial assets and don’t be overly optimistic about your remuneration and income.”
This week Google, whose Android operating system powers most of the world’s smartphones, said it would cut ties with Huawei as a result of the ban.
Another critical partner, ARM Holdings — a British designer of semiconductors owned by Japanese group Softbank — said it was complying with the US restrictions.
“On its own Huawei can’t resolve this problem, we need to seek support from government policy,” one unnamed employee wrote last week, in a post that received dozens of likes and replies.
The employee outlined a plan for China to block off its smartphone market from all American components much in the same way Beijing fostered its Internet tech giants behind a “Great Firewall” that keeps out Google, Facebook, Twitter and dozens of other foreign companies.
“Our domestic market is big enough, we can use this opportunity to build up domestic suppliers and our ecosystem,” the employee wrote.
For his part, Ren advocated the opposite response in his interview with Chinese media.
“We should not promote populism; populism is detrimental to the country,” he said, noting that his family uses Apple products.
Other employees strategized ways to circumvent the US ban.
One advocated turning to Alibaba’s e-commerce platform Taobao to buy the needed components. Another dangled the prospect of setting up dozens of new companies to make purchases from US suppliers.
Many denounced the US and proposed China ban McDonald’s, Coca-Cola and all-American movies and TV shows.
“First time posting under my real name: we must do our jobs well, advance and retreat with our company,” said an employee named Xu Jin.
The tech ban caps months of US effort to isolate Huawei, whose equipment Washington fears could be used as a Trojan horse by Chinese intelligence services.
Still, last week Trump indicated he was willing to include a fix for Huawei in a trade deal that the two economic giants have struggled to seal and US officials issued a 90-day reprieve on the ban.
In Xinsheng, an employee with the handle Youxin lamented: “I want to advance and retreat alongside the company, but then my boss told me to pack up and go,” followed by two sad-face emoticons.