President issues ordinance ratifying tax amnesty scheme
ISLAMABAD: President Mamnoon Hussain on Sunday gave the go-ahead to a new tax amnesty announced by the prime minister last week to encourage Pakistanis to declare their undeclared assets in the country and abroad.
The president issued four ordinances – Voluntary Declaration of Domestic Assets Ordinance 2018, Foreign Assets (Declaration and Repatriation) Ordinance 2018, Income Tax (Amendment) Ordinance 2018, and Economic Reforms (amendment) Ordinance 2018 – to implement the Economic Reforms Package (ERP).
On April 05, Prime Minister Shahid Khaqan Abbasi announced a five-point tax reforms package envisaging substantial reduction in income tax rates and an amnesty scheme for undeclared foreign and domestic assets.
According to the scheme, 120 million national identity card holders will be assigned tax numbers in the future.
Under the scheme, all Pakistanis will be able to declare their undeclared assets and bring their money into the tax net after paying a five-percent one-off penalty. Pakistanis living overseas and declaring their income or assets would pay a two per cent one-time penalty.
Those earning more than Rs48 million annually will be liable to pay 15 percent tax on their income, according to the scheme.
Reports said the government has given a long list of people who can avail the amnesty scheme, including presidents, prime ministers, ministers, governors, chief ministers councilors, nazims, government consultants and judges of the higher and lower courts.
The amnesty scheme is valid till June 30.
It remains to be seen whether the tax amnesty scheme will achieve its objective or not as some economist believe the tax amnesty will be of little help as those declaring undeclared assets will have no protection from the law enforcement, which might ask them the source of their income and subject them to accountability.
The opposition parties, mainly Pakistan Peoples Party (PPP) and Pakistan Tehreen-i-Insaf (PTI), have strongly rejected the tax amnesty scheme, terming it a ploy to ‘fool taxpayers’ and whiten black money.