"The government plans to expand scope of its proposed amnesty scheme for the rich people and provide to them exemption from tax audit for a maximum of 10 years in order to bring them on tax rolls of the country." Dawn December 14, 2015

"Why am I punished for being a law abiding citizen of this country? I have been paying all my taxes -- both federal and provincial plus any default surcharge or penalty for minor aberrations without the comfort of getting refunds other than through greasing the palms of revenue officials -- yet the multiple tax authorities are bent upon stifling my life. Despite paying hefty taxes, I have to run from pillar to post to obtain health, educational and security facilities without any respite from the government and to top it all, unscrupulous revenue officials pop up any moment to increase my miseries. To add insult to injury, I am told that the government intends to grant a ten years’ exemption from tax audit to tax dodgers. What about me? Why no such exemption for me for the next 20 years at least, for observing the law of the land? Why am I constantly tortured and made to feel like a fool while criminals are treated with unprecedented mercy? Even the justice system has failed to give me the protection that I deserve against a corrupt and malicious State machinery."

Although this plea is made by Mr Betrayed, a middle class salaried individual who spent the last 30 years of his life toiling hard eking out an honest living, religiously observing all rules and regulations and paying whatever was due; yet they aptly reflect the feelings of those who, in their patriotism, never allowed themselves to be lured towards tax evasion, no matter how appealing the stakes were. What a strong reaction to the new proposal in the tax amnesty scheme introduced by Finance Minister Ishaq Dar!

Says Mr Cheat, a chronic tax dodger,

"Why do you think I avoid appearing in the books of the revenue authorities? I cherish my health and sanity. What does the government give me that I should be grateful for? The regular taxpayers are foolish to pay upfront as taxes and also for basic amenities that they have to purchase. They may enjoy being tormented by nosy tax officials, unscrupulous professionals, lengthy periods of litigations leading nowhere but I have no time or money to waste on tedious compliances and petty disputes with the government. It does not cost much to keep away the revenue authorities from my doorstep but it would take its toll if I allow myself to be led into the world of taxpayers. Besides, what have I to lose when the government has already armed me with the heavenly provision of section 111(4) of the Income Tax Ordinance, 2001 and if that is not helpful there would always be an amnesty scheme in the offing giving me a safety net. Then why should I be humiliated like other taxpayers?"

Time and again we have emphasised upon the worthlessness of tax amnesty schemes and their accompanying wrong messages encouraging immorality, illegality and cheating that are sent to law-abiding citizens of the country. Amazingly the track record of the government with respect to amnesty schemes has always remained questionable with boastful high expectations resulting in too little a gain. The more it extends its appeasing arm towards the delinquent taxpayers, the more it loses its existing ones and in the long run, its very own credibility because frequent introduction of these schemes envisages admission of failure as law enforcer and custodian of the constitution.

Amnesty schemes are not answers to solving the menace of poor tax compliance nor are the many provisions regarding deductions/payments of taxes at source or in advance. In fact the way these are sculptured do the exact opposite as proven by many such schemes introduced in the past. Without conducting proper enquiries to understand the reasons for earlier fiascos, the government keeps on committing the same mistake over and over again.

No study has been undertaken so far by the revenue authorities to provide a comprehensive account of the outcomes of liberal amnesties offered to tax criminals. Had this been carried out, the government would have received educated advice from the executive, directing its attention on what should actually be done rather than repeatedly falling in the same trap. On the other hand, they are quick to propose new plans or amendments in law either to bag more seats in the administrative machinery or to transfer burden of collecting taxes on withholding agents instead of addressing their own incompetence in executing tax laws.

In all fairness, a just tax system  should be devised with the sole purpose of providing maximum relief to existing tax compliant population and punishment for the delinquents and not the vice versa as done by this government during all its three terms in office. By leaving them alone for a period of at least five years and focusing purely on delinquents, the Federal Board of Revenue (FBR) would be more successful in harnessing and bringing within its folds much higher number of taxpayers than any scheme can ever achieve.

With its energies diverted to unearthing all such persons who have so far remained out of the tax net, the FBR can usher in a new era of tax collection never seen before. Punishing law abiders can never help to increase revenue. On the contrary, by glorifying and appreciating contributions of existing taxpayers, the FBR can encourage more people to file returns and pay taxes.

Taking stern action against tax dodgers, imposing heavy penalties and prosecuting tax criminals may not seem pleasing measures but would go a long way in reforming tax culture in Pakistan while mitigating grievances of the existing taxpayers, reaffirming their trust in the working of the government. This is the true face of amnesty, or put more appropriately, true form of facilitation. Reward for compliance and castigation for defaulters, if only our government would understand.