Human beings are not surprisingly, attached to the place of their birth, no matter how advanced or how backward it might be but sometimes under pressing circumstances they are forced to migrate and settle in foreign lands. for
Pakistan is also one of those countries where people have migrated to and migrated from in very large numbers. Despite a very sporadic political history, there is something about this land that migrants desire returning to although they may be happily settled anywhere else in the world. With tremendous enthusiasm many have returned with the objective to make it their home again but there are some serious impediments that discourage resettlement and which must be heeded to by whoever is in power.
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On the one hand, our incumbent prime minister is desperately seeking the assistance of expatriates to help the country out of its financial crisis and on the other, those who are willing to step in are ruthlessly shunned, discouraged and at times even persecuted for trying to establish industries, provide employment and boost economic growth with their hard earned money brought in through normal banking channels. There are many such instances where attempts to resettle have failed miserably.
There are a number of dissuading authorities unleashed by the government but not a single one that is specially designed to facilitate returning expatriates with their many questions and apprehensions. Consequently, when faced with hurdles, unseen snags and bureaucratic red-tapism, they are left with no choice but to wind up and go back to their safe havens. It is one thing to attract foreign investment and another to abide by promises of both, ease of doing business and providing information for smooth functioning.
One such entrepreneur who migrated to the United Arab Emirates (UAE) in the new millennium came back to Pakistan in 2016 with millions transferred through banks to establish industrial concerns here. With patriotic eagerness, he quickly formed companies and business associations involving local investors but within a span of three years, he found himself winding up his operations and selling away the industries at throwaway prices to make his exit to the Gulf again.
When questioned regarding his experiences and as to why he was so disheartened, he had nothing positive to say besides long tales of harassment at the hands of government officials from the Federal Board of Revenue (FBR), Federal Investigation Agency (FIA) and a host of other attached organizations who approached him with the clear purpose of fleecing him in the name of conducting official duties. Just because he had a pocketful of money that he wanted to invest for setting up plants and industrial concerns and was in the process of providing jobs to a number of unemployed persons, he was an easy target for these official vultures ready to dig their claws in the flesh of this investor.
It must be remembered that settlers coming from the UAE have no inkling about tax matters since there is no personal income tax in this region. Sales tax at the rate of 5% was introduced as recently as January 2018. As a result, they are caught quite unprepared to face the tax authorities here whose notorious reputation is not hidden from anyone. They are there at your doorstep even before you earn a single rupee. Inspectors from FIA start hovering around asking irrelevant questions related to remittances, banking transactions that by the way, are supposedly documented and original sources of income in the UAE as if it should be of any concern to the local authorities. If the person’s repute is clean and he is not found involved in any subversive activities there appears no valid ground to unnecessarily create problems for him.
Another major challenge confronting him was lack of departmental co-ordination. Instead of sharing details with each other, every department wanted first hand information from the person in question as if he had nothing better to do the whole day but churn out photocopies of documents already submitted to one agency. One official who was handed out a copy shamelessly asked to be given the same statement in the person’s own handwriting.
He claims that he would have survived these difficulties but the last nail in the coffin were the extremely illogical and cumbersome procedures in dealing with filers/non-filers and registered/unregistered persons in the income tax and sales tax regimes respectively. According to him, before he could earn any income, he was expected to pay tax on it and also pay sales tax from his own pocket while transacting with unregistered persons who are many times more in number compared to registered persons, thanks to our ‘over-efficient’ FBR that has failed to harness millions of commercial and industrial electricity users.
Totally exasperated by these prevailing maladies, the gentleman ultimately decided to leave his beloved country and take refuge in the balmy environment of the UAE where although he may never be able to earn a citizenship but would be left in peace with no official knocking on his door to hurl obstacles in his way. His earnings would be his own and no person would have the indecency to burden him with his own obligations.
In addition to readdressing its fiscal policies, the government needs to reassess its present system of incentivizing economic growth whether at the behest of local entrepreneurs or foreign investors. Instead of giving them ample breathing space and opportunities to create conditions leading to prosperity there is no sense in throttling potential businessmen with unnecessary procedural hiccups that may cause flight of capital leaving the poor people of this land at the mercy of rulers who rather than giving them relief, keep piling loan upon loan on their feeble shoulders.
(The writers, lawyers and partners in Huzaima, Ikram & Ijaz, are Adjunct Faculty at Lahore University of Management Sciences)
(This news/article originally appeared in Business Recorder on September 20th, 2019)