Pakistan's tax code a conservative wet dream

[barnesfoto]

http://www.nytimes.com/2010/07/19/wo...ef=global-home

Pakistan’s Elite Pay Few Taxes, Widening Gap
By SABRINA TAVERNISE
ISLAMABAD, Pakistan — Much of Pakistan’s capital city looks like a rich Los Angeles suburb. Shiny sport utility vehicles purr down gated driveways. Elegant multistory homes are tended by servants. Laundry is never hung out to dry.

But behind the opulence lurks a troubling fact. Very few of these households pay income tax. That is mostly because the politicians who make the rules are also the country’s richest citizens, and are skilled at finding ways to exempt themselves.

That would be a problem in any country. But in Pakistan, the lack of a workable tax system feeds something more menacing: a festering inequality in Pakistani society, where the wealth of its most powerful members is never redistributed or put to use for public good. That is creating conditions that have helped spread an insurgency that is tormenting the country and complicating American policy in the region.

It is also a sorry performance for a country that is among the largest recipients of American aid, payments of billions of dollars that prop up the country’s finances and are meant to help its leaders fight the insurgency.

Though the authorities have tried to expand the net in recent years, taxing profits from the stock market and real estate, entire swaths of the economy, like agriculture, a major moneymaker for the elite, remain untaxed.

“This is a system of the elite, by the elite and for the elite,” said Riyaz Hussain Naqvi, a retired government official who worked in tax collection for 38 years. “It is a skewed system in which the poor man subsidizes the rich man.”

The problem starts at the top. The average worth of Pakistani members of Parliament is $900,000, with its richest member topping $37 million, according to a December study by the Pakistan Institute of Legislative Development and Transparency in Islamabad.

While Pakistan’s income from taxes last year was the lowest in the country’s history, according to Zafar ul-Majeed, a senior official in the Federal Board of Revenue, the assets of current members of Parliament nearly doubled from those of members of the previous Parliament, the institute study found.

The country’s top opposition leader, Nawaz Sharif, reported that he paid no personal income tax for three years ending in 2007 in public documents he filed with Pakistan’s election commission. A spokesman for Mr. Sharif, an industrialist who is widely believed to be a millionaire, said he had been in exile and had turned over positions in his companies to relatives.

A month of requests for similar documents for Pakistan’s president and prime minister went unanswered by the commission; representatives for the men said they did not have the figures.

“Taxes are the Achilles’ heel of Pakistani politicians,” said Jahangir Tareen, a businessman and member of Parliament who is trying to put taxes on the public agenda. He paid $225,534 in income tax in 2009, a figure he made public in Parliament last month. “If you don’t have income, fine, but then don’t go and get into a Land Cruiser.”

The rules say that anyone who earns more than $3,488 a year must pay income tax, but few do. Akbar Zaidi, a Karachi-based political economist with the Carnegie Endowment, estimates that as many as 10 million Pakistanis should be paying income tax, far more than the 2.5 million who are registered.

Out of more than 170 million Pakistanis, fewer than 2 percent pay income tax, making Pakistan’s revenue from taxes among the lowest in the world, a notch below Sierra Leone’s as a ratio of tax to gross domestic product.

more: http://www.nytimes.com/2010/07/19/wo...gewanted=print

[Crumbled_pavement]

That's the way it should be. Rich people should not have their money stolen from the government just because they were industrious and hardworking and made a good life for themselves. It's the poor lazy slob that should suffer the consequences of their poor decision making. Do not punish the wealthy job creators who enabled the economy to even exist!

[oladub]

Maybe that's why SOS Clinton had to give away $500,000,000 of US taxpayer dollars to Pakistan on Friday to add to the over $12B the US has given Pakistan since 2002.

[Papasito]

Pakistan's tax code a conservative wet dream

Rich people should not have their money stolen from the government just because they were industrious and hardworking and made a good life for themselves.

2 extremes.
Everyone should pay thier fair share.
And the Fair Tax really does seem fair.
5 or 1O% for everyone or whatever the rate may be, even as a comsumption tax, does not come to me as an issue. Especially if it's a consumption tax. Obviously, rich people consume more.

[firstandten]

That's the way it should be. Rich people should not have their money stolen from the government just because they were industrious and hardworking and made a good life for themselves. It's the poor lazy slob that should suffer the consequences of their poor decision making. Do not punish the wealthy job creators who enabled the economy to even exist!

Do you really believe that or are you injecting some much needed humor in this thread ?

[Johnlodge]

2 extremes.
Everyone should pay thier fair share.
And the Fair Tax really does seem fair.
5 or 1O% for everyone or whatever the rate may be, even as a comsumption tax, does not come to me as an issue. Especially if it's a consumption tax. Obviously, rich people consume more.

For some reason I am not allowed to send you a PM.

[Detroitej72]

Maybe that's why SOS Clinton had to give away $500,000,000 of US taxpayer dollars to Pakistan on Friday to add to the over $12B the US has given Pakistan since 2002.

If the U.S. cut all aid to other countries, we'd have enough surplus to restore unemployment benefits, balance the budget and maybe even cut some taxes.

If Re-pubs are serious about reducing spending, they would start here, but don't expect them to pick up the baton since they get plenty of money from lobbyists for countries such as Israel and Saudi Arabia.

[oladub]

If the U.S. cut all aid to other countries, we'd have enough surplus to restore unemployment benefits, balance the budget and maybe even cut some taxes.

If Re-pubs are serious about reducing spending, they would start here, but don't expect them to pick up the baton since they get plenty of money from lobbyists for countries such as Israel and Saudi Arabia.

Totally agree and that is why we should be greatful that Democrats are above all that. However, in mentioning the $500,000,00 of US taxpayer dollars to Pakistan to add to the over $12B the US has given Pakistan since 2002 I negected to mention that Hillary is also planning to provide an additional $7,000,000,000 of aid to our Pakistan allies. It's too bad that some Republicans seem more concerned with President Obama spending $23,000,000 interfering with a Kenyan election than his dumping $7,500,000,000 into Pakistan.

Why should Pakistan raise it's taxes when it has such good friends? Not that I'm conceding the non-Constitutionality of federal unemployment compensation but I think we just came up with a better use of $7,523,000,000.

[gdogslim]

Isn't is true that the hypocrites who call themselves democrats, hide their money many are rich and talk out of both sides of their mouths? They want OTHERS not to do what they do and have

[MCP-001]

Isn't is true that the hypocrites who call themselves democrats, hide their money many are rich and talk out of both sides of their mouths? They want OTHERS not to do what they do and have

Like the Kilpatrick Family?

The Conyers'

Charlie Rangle?

Chris Dodd?

Naaaaaahhhh, they aren't hypocrites.

OABTW, I would have absolutely no problem in cutting off ALL foreign aid immediately.

Good luck getting THAT through Congress!

[Papasito]

Democrats do want to give the illusion they are not rich and are the party of the poor.
And yes, many of them are rich.
But a lot of people buy the illusion, so more power to them.
It just means the propaganda works!