President issues ordinance approving tax amnesty scheme

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President Mamnoon signs FATA-KP merger bill
President Mamnoon signs FATA-KP merger bill

ISLAMABAD: President Mamnoon Hussain on Sunday issued the Foreign Assets (Declaration and Repatriation) Ordinance bringing into effect a tax amnesty scheme announced by the prime minister earlier this week.
The ordinance encompasses assets obtained on installments, declaration of property as per the “fair market value” and its confiscation by the government in case of violation, declared and undeclared foreign assets, including “real estate, mortgaged assets, stock and shares, bank accounts, bullion, cash, jewels, paintings, accounts and loan receivables, beneficial ownership or beneficial interests or contribution in offshore entities and trusts.”
It said the officials appointed by the government for the implementation of the ordinance would be empowered. The provisions of the ordinance shall apply to all citizens of Pakistan wherever they may be, except “holders of public office, their spouses and dependent children.”
The particulars of any person making a declaration under the ordinance, or any information received in any declaration made under the ordinance, shall be confidential.
Prime Minister Shahid Khaqan Abbasi had unveiled a five-point tax reforms package on Thursday, which included a tax amnesty scheme for undeclared foreign and domestic assets, and reduction in income tax rates.
The prime minister launched the amnesty scheme and reforms package in a last-ditch attempt at broadening the government’s revenue base, merely 55 days before the end of the government’s tenure.
Govt to monitor financial records of citizens and issue notices if it finds tax evasion. Parliament to decide penalties.
Tax evasion has been rampant in Pakistan, where only 1 percent of the adult population pays tax.
Announcing that all 120 million national identity card holders would be assigned tax numbers, Abbasi had told a news conference in Islamabad: “If you don’t pay taxes, Pakistan will not be sustainable.”
He had said that politically exposed persons (PEPs) and their families were not eligible to benefit from the scheme — valid till June 30.
“Under the amnesty plan, all Pakistanis will be able to declare their unreported income and assets and bring their money into the tax base after paying a 5 percent one-off penalty,” Abbasi had said.
Adviser to the prime minister on Finance Miftah Ismail assuaged the concerns of the Financial Action Task Force (FATF) on Saturday and assured the tax amnesty scheme does not violate money laundering laws.
“Pakistan’s tax amnesty scheme adheres to all international anti-money laundering laws,” the adviser on finance said while speaking to Geo News.
Ismail shared that he has received an e-mail from the global money-laundering watchdog, FATF, calling for global needs and the agreed-upon guidelines to be respected.
“The FATF has stressed upon strict monitoring of money laundering and terrorist financing activities,” the Pakistani premier’s financial adviser said.
Ismail further said he has not responded to the email as yet.

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