Panama debates

Long before the publication of ‘Panama Papers’, many cases of unlawful capital outflows, tax avoidance and corruption by public officeholders and others were cited in these columns. However, National Accountability Bureau (NAB), State Bank of Pakistan (SBP), Federal Board of Revenue (FBR), Federal Investigation Agency (FIA), and provincial anti-corruption departments, as expected, chose to look the other way. Till today, no effort has been made by these agencies to form joint investigation teams for probing allegations levelled in the Panama Papers and elsewhere.

The NAB submitted before the Supreme Court on July 6, 2015 that inquiries were pending against Nawaz Sharif, Shahbaz Sharif, two former premiers, ministers, former generals and many top bureaucrats, the most shocking revelation being “three cases pending against the Finance Minister for 23 million pounds, 3,488 million dollars and 1,250 million dollars”.

All over the world, the main issue arising from the Panama Papers is lack of moral standards for those who represent people and hold public office. They cannot and should not hide their financial matters behind the laws of secrecy and privileges. In this context, it is necessary for our Prime Minister, notwithstanding the inquiries by NAB, to forthwith make public sources of funds for the construction of Raiwind Palace spread over 1700 acres (6,8000,000 square yards). Purportedly in the name of mother (Shamim Sharif), this property has never been mentioned in statements of assets and liabilities of Nawaz Sharif and other members of his family in politics. Even the latest declarations submitted to the Election Commission of Pakistan by Nawaz Sharif, his brother Shahbaz Sharif, son-in-law Captain Mohammad Safdar (Retd) and nephew Hamza Shahbaz are silent on the ownership title of this huge property. Who incur(s) the expenses on maintaining this property? Shamim Sharif has never filed income tax return(s) to disclose the sources from which this estate was created and maintained.

The Sharifs have a fleet of expensive cars (besides using official ones). These are either not shown in their asset declarations or claimed to have been received as gifts in declarations filed before the Election Commission of Pakistan (ECP). They must tell the public who are these donors. They own huge agricultural lands and have investments in industrial units like sugar, textile and paper mills. Shahbaz Sharif has two properties in the United Kingdom, but Nawaz Sharif has declared no assets abroad. In the last elections, Shahbaz was richer than Nawaz – though none of them are billionaires- but things became different within a year as the value of Nawaz Sharif’s wealth registered a six-fold increase to make him a billionaire for the first time. The Prime Minister is beneficiary of “wealth” earned abroad by his adult sons by receiving huge gifts from them. The family unit is exchanging money and sources and modes of these transfers need to be investigated.

Statements of assets filed before EEP show that the Sharif brothers have much in common. Both live in houses not owned by them. Nawaz Sharif lives in a house owned by his mother while Shahbaz Sharif resides in a house owned by his spouse Nusrat Shahbaz. They must inform the public the sources of maintaining these properties. Since these are private residences they should not be maintained through public exchequer.

As per Dawn, January 03, 2014, the following was the position of assets of Sharifs: 

“Net worth of Nawaz Sharif’s was Rs 261.6 million in 2012 and that of Shahbaz Sharif Rs 336.9 million. In 2011, the assets of the two brothers were worth Rs 166 million and Rs 393 million, showing an increase of Rs 95.6 million and a decrease of Rs 56.5 million, respectively. In 2013, the value of assets of Nawaz Sharif ballooned to Rs 1.82 billion, while that of Shahbaz Sharif slipped further down to Rs 142 million. Shahbaz Sharif admitted stakes abroad showing properties and bank accounts in the UK. The assets of Tehmina Durrani, the wife of Shahbaz Sharif, included five bank accounts – two in Pound Sterling, one in dollar and two in Pak rupees, but the money in these accounts is only Rs 23,770. She has cash in hand and prize bonds worth Rs 750,000 and two cars. On the other hand, Kalsoom Nawaz, the First Lady, has net wealth of Rs 235.85 million, which is much less than that of Nusrat Shahbaz. Kalsoom Nawaz has land and a house in Changa Gali, Abbottabad, worth Rs 63.75 million, a bungalow on Mall Road in Murree worth Rs 100 million, 88 kanals of land in Sheikhupura worth Rs 70 million, jewellery of Rs 1.5 million and shares in family businesses. She has Rs 67,555 cash in hand and Rs 55,765 in banks. Hamza Shahbaz is wealthier than his father with net assets of Rs 250.46 million. He has two wives. The wealth of his first wife is Rs 2.45 million and that of the second is Rs 9.88 million. Captain Safdar (Retd) has wealth of only Rs 14.23 million. He owns a car which his wife Maryam received as a gift from the UAE.”

In the wake of the Panama Papers, the assets of other politicians, generals, judges and high-ranking civil officers should also be investigated on a priority basis vis-à-vis their tax declarations. The apex court should also summon the Chairman of NAB, FBR, Director General of FIA, Governor SBP, etc, to explain the inefficiency of their organisations in countering unlawful outflows/inflows, tax evasion and corruption.

The determination of the quantum of black money, rent-seeking and tax evasion is a daunting task. It is an incontrovertible fact that Pakistan is a unique case where the State, instead of combating corruption, sponsors and patronises all kinds of undesirable practices. Pakistan is a victim of reverse capital flows and capital flights due to policies of appeasement by successive governments towards the corrupt and criminals.

The ultimate cynicism that afflicts a society is acceptance of corruption as a way of life. Unfortunately, after seven decades of independence, this is precisely where we have reached. Pakistan cannot progress unless foundations of corruption and rent-seeking are destroyed. For this it is necessary to forfeit all benami (untaxed/undeclared) assets in favour of the State. Immunities and amnesties for criminals, plunderers of the national wealth and tax evaders must be abandoned without any further delay.

The majority of the members of Parliament have declared shamelessly low incomes as evident from Tax Directories for 2013 and 2014 published by FBR. The elected members, politicians, public office holders, bureaucrats, generals and judges should be investigated by an independent commission, comprising experts and men of impeachable integrity, as to ownership of their assets (in own name, family, relative and benami) and style of living vis-à-vis their declared incomes. This process alone will ensure true accountability in Pakistan. Once the rich and mighty are taken to task, all citizens will obey the laws and pay their taxes honestly and diligently.