Zia Ullah Marwat
THE 18th Amendment which has been introduced into the Constitution of 1973 is a landmark achievement in the up and down constitustional history of Pakistan. With emergence of the amendment all powers which are globally considered to be exercised by federating units under federal republic have been devolved to the provincial governments. The amendment has also transformed into practical shape the historical wish of provincial autonomy of founding father of the state expressed in his historical speech in 1948 in Quetta. Besides, it has also addressed the longstanding demand of provincial autonomy of smaller nationalities of Pakistan.
The incumbent government has made a couple of overwhelming attempts to roll back the historical amendment but to no avail. The government rigidly and exclusively holds liable the amendment for constitutionally authorizing and transferring lion share of revenue from Federal Divisible Pool to provinces which resultantly leaves federal government with little amount of revenue insufficient to meet the annual spending particularly required for defense purposes and debt servicing. But the heated argument cited by the government has no leg to take stand as the fiscal problem lies with the federal government which is to be fixed by taking a few remedial measures. The incumbent government shall broaden the tax base to collect more revenue. The existing mechanism for tax collection is very much biased on account of tax rate imposed on corporate sector which has 63% contribution to GDP much higher as compared to the agriculture sector which contributes merely 1.2 %.
An amendment shall be introduced into the tax related laws to legally authorize and maximize new tax rate with moderate ratio on agriculture sector, sales taxes, excise duty, income tax and custom duties. Similarly new policy is to be chalked out to regularize the rampant smuggling of petrol and non-custom paid vehicles through Iran and Afghanistan borders into Pakistan. It will adequately assist the federal government to properly meet the existing crisis of fiscal deficit.
A dozen of federal ministries like environment, health, labour, manpower, education and food were devolved to the provinces under the 18th Amendment, but still they have been retained by federal government by changing their names just to skirt the legal necessity. Ministry of Environment has been renamed as Climate Change, Health as National Health Services, Labour and Manpower as Overseas Pakistanis and Resources Development, Education as Federal Education and Professional Training, Food as Agriculture and National Food Security. The government can smoothly accelerate its savings by practically devolving the ministries. The incumbent government shall also take productive and preventive measures to rein in the expenditure which is being unnecessarily made out by the ministers or civil servants. The official trips either abroad or at home which are unnecessarily and aimlessly being arranged by ministers and bureaucrats for the ulterior purpose to make TA/DA must be stopped. Similarly, facilities like conveyance etc rendered to civil servants for official purposes while used for personal matters must be stopped.
Strict implementation of tax-related laws is also crucial need of the time. Government functionaries who are statutory liable for tax collection shall be empowered and facilitated to make sure across-the-broad implementation of the tax laws. The Inland Revenue Service (IRS) which is mandated for collection of sale, income and excise tax is a paper tiger as they frequently complain of being powerless under Income Tax Ordinance, 2001. IRS is required to be fully empowered.
Accountability courts like National Accountability Court can also assist govt to coup with the financial crisis if universally recognized concept of across-the-broad accountability is implemented in its true spirit. The on-going reign of selected and political implementation of NAB against political opponents must be discouraged. The court shall be set free from any political influence to strictly and straightly hold liable tax evaders and embezzlers of public money irrespective of their political affiliation with any political party.
—The writer is an Advocate stationed in Islamabad.
