WEB DESK: It is well-established by now that our politics is infected with business wars among various vested interests having mega economic stakes. Recently, Jahangir Tareen Khan, Member National Assembly of Tehreek-e-Insaf, revealed that litigation “is pending in Lahore High Court between him and the ruling family over relocation of their sugar mills in areas where he owns similar units.”
He accused the government of “using the Federal Board of Revenue (FBR) against political opponents.” Claiming to be among the top taxpayers of the country, he said that “FBR is victimising me because I am business rival of the Prime Minister”. He said on the floor of the House: “I have secured a stay order from High Court against Chaudhry Sugar Mills owned by the Prime Minister, “which is violated by him.”
The war over securing ‘sugar monopoly’, as claimed by Tareen, also manifests from the order of Supreme Court in C.As. 1242 to 1245/2013 12, Para 7 of which reads as under: Salman Akram Raja, the learned ASC, had submitted an application (CMA No 2977/2016) on behalf of Ittefaq Sugar Mills Limited to be impleaded as a party, as according to him a decision in this matter may adversely affect the said company as it had sought the relocation of its sugar mills installed in District Pakpattan to District Bahawalpur at a place near the border with District Rahim Yar Khan. Without granting the said application we permitted him to make his submissions on behalf of the said Company.
JDW Sugar Mills Limited and Hamza Sugar Mills Limited, presumably the competitors of Ittefaq Sugar Mills Limited, had filed Writ Petition No 12879 of 2015 seeking to restrain the said shifting whereas Ittefaq Sugar Mills Limited had filed Writ Petition No 18827 of 2015 wherein the impugned Notification has been assailed though in the alternative it has been stated that the impugned Notification does not restrict the relocation of existing sugar mills. Both these petitions we are told are still pending before the Lahore High Court.
The petitioners in Writ Petition No 12879/2015 are opposing the proposed shifting as it would increase the installed capacity of sugar mills in the Southern Punjab Districts which they state is not sustainable as the available installed capacity is already under utilized. However, Mr Salman Akram Raja controverted their objection. He also referred to a document to show that the cultivation of sugarcane crop in the area has considerably increased if the figures for the years 2005-2006 are compared to those of 2014-2015.
It appears that there is a tussle between two different sugar mills’ owners regarding the relocation of an existing sugar mill, whereas the matter considered by us is the determination of the legality of the impugned Notification which has imposed a ban on the setting up of new sugar mills and also expanding the installed capacity of existing ones. Therefore, it would not be appropriate for us to express any opinion on this aspect of the matter which has as yet not been decided by the Lahore High Court where the said two writ petitions are pending adjudication.
Earlier on September 5, 2016, the Lahore High Court suspended a wealth tax recovery notice issued to Tareen by FBR. While alleging recovery as “political victimisation”, petitioner’s counsel argued that “FBR unlawfully issued the impugned notice for the recovery of Rs 130 million.” The High Court suspended the notice and sought a reply from the FBR by September 30, 2016.
On September 9, 2016, Jahangir Tareen, speaking on a point of order on the floor of National Assembly, criticised the Speaker for sending reference to the Election Commission of Pakistan for his disqualification. He claimed: “Allegations against me are fabricated and the sugar mill attributed to me is actually owned by Haroon Akhtar.”
Profile of Haroon Akhtar, Special Assistant to Prime Minister on Revenue/Minister of State on website of FBR shows his immense business interests in sugar, textile and manufacturing of soft drinks, water and juices, etc. In August 2016, some officers of FBR denied promotions to BS-22 and in their writ petitions they questioned the appointment of Haroon “on incumbent position in view of a pending inquiry proceeding against him and his family with NAB on charges of corruption, money laundering, tax evasion and malpractice vis-à-vis a suspicious transaction of foreign remittance of US $6.9 million.”
Haroon has denied all the charges. However, according to a leading newspaper, till today the worthy Minister of State has not disclosed the source of remittance of Rs 700 million.
The above shows how politics and business have been intertwined in today’s Pakistan. Those having big business interest are in the position to secure benefits and/or damage their competitors. We all know that no investigation will be made by NAB, FBR, FIA, SECP and SBP for violation of laws of the land.
The name and shame game of tax evaders and looters of public money through Bahamas Leaks, Panama Leaks and own publications of FBR-Tax Directory for tax years 2013, 2014 & 2015-has failed to bring any change in the attitude of our institutions as even after blatant corruption and tax evasion by elected representatives they have displayed their inability/unwillingness to bring the culprits to justice. Unfortunately, the government that has the main responsibility to tackle the twin menace of tax evasion and black money is totally indifferent-rather it is geared to bringing another amnesty scheme to cover up the massive tax evasion.
According to reports, on the instructions of political masters, FBR has almost finalised an amnesty scheme for whitening hidden assets at home and abroad by paying a flat rate of as low as 3%. This would be approved from the National Assembly as money bill bypassing the Senate where the government lacks majority. This will also technically defeat the move by Opposition to pass in the Senate the bill seeking constitution of a judicial commission to investigate the Panama Papers scandal. On September 26, 2016, Senate Chairman allowed Leader of the Opposition, Aitzaz Ahsan, to introduce the bill on behalf of all opposition parties after a vote count, in which 32 members voted in its favour and 19 against it. The Chairman had to order the vote-count when Law Minister, Zahid Hamid, opposed the bill, terming it “person-specific and discriminatory.”
Politics in Pakistan now presents an ugly picture where business wars are aimed at preserving own empires and destroying that of the opponents. Nobody is serious to investigate the allegations of tax evasion or corruption. The real agenda is to use it as political weapon to hide one’s own wrongdoings and win elections.
Our rulers and majority of businessmen are hooked on ill-gotten wealth/income for the last many decades. The businessmen know for certain that after every two or three years, there would be an amnesty scheme giving them a chance to get their income/assets whitened by paying far less an amount than what they would have been required to pay under normal income tax/wealth tax regime. It is a tragic situation where the entire State apparatus is subservient to those who blatantly manage to hide their income and wealth. It is an ugly joke with those who are paying their taxes honestly at much higher rates than those offered to tax evaders.
The ugliest face of black money emerges in the corridors of power, political as well as administrative. No country other than Pakistan knows better about the dangers of allowing money launderers and drug traffickers to get an upper hand. The fact is that a cartel or a group of cartels is become so powerful that it can work out agreements with terrorists and saboteurs to undermine the authority of the State.
As pointed out in many earlier articles in these columns, unprecedented benefits were extended to the powerful segments-persons having political-cum-business clouts-through innumerable Statutory Regulatory Orders (SROs). The abuse of SROs, like, 125(I)/2011(zero rating), 549(I)/2008 (zero rating), 646(I)/2005 (zero rating), 811(I)/2009 (zero rating), 863(I)/2007(zero rating), 125(I)/2011 [reduce rate of 5% for textile, carpet, leather, sports and surgical], 608(I)/2012 [reduce of 5% for black tea], 79(I)/2012 [reduce rate of 5% for tractors], First Schedule of FED [8% for sugar], 1007(I)/2005 [sales tax exemption], 164(I)/2010 [sales tax exemption], 172(I)/2006 [sales tax exemption], 26(I)/2008 [sales tax exemption], 408(I)/2012[sales tax exemption], 539(I)/2008 [sales tax exemption], 542(I)/2008 [sales tax exemption], 551(I)/2008 [sales tax exemption], 727(I)/2011 [sales tax exemption], 76(I)/2008 [sales tax exemption], 880(I)/2007 [sales tax exemption], Sixth Schedule of Sales Tax Act, 1990 [sales tax exemptions] and Third Schedule of Federal Excise Act, 2015[exemptions of goods and services]; have not only caused loss of billions to national exchequer but also generated huge black money. This dirty money in the hands of unscrupulous elements has earned them dominance in politics. On the basis of their ill-gotten wealth they come into power and then use their influence to undermine State institutions.
(The writers, lawyers and partners in Huzaima, Ikram & Ijaz, are Adjunct Faculty at Lahore University of Management Sciences (LUMS).)
Source: Business Recorder