Amnesty Scheme To Whiten Offshore Foreign Assets Is Opposed By IMF

Amnesty Scheme To Whiten Offshore Foreign Assets Is Opposed By IMF: The government recently announced amnesty scheme got an objection from International Monetary fund (IMF). IMF’s Mission Chief for Pakistan stated that experience from Pakistan and other countries with repeated tax amnesties depicts that these often fail to achieve their intended objectives while potentially discouraging the perception of fairness and transparency of the tax system and future efforts to improve tax compliance.

The International Monetary Fund (IMF) has opposed Amnesty Scheme introduced in Pakistan and said that such schemes failed to achieve their intended objectives and this amnesty scheme will whiten offshore foreign assets as well as domestic assets.

IMF has publicly expressed its opposition to Amnesty Scheme in Pakistan arguing that it doubts the perception of fairness in taxation system and future compliance efforts.

Reason Why IMF, FATF & World bank Have Opposed Amnesty Scheme

Amnesty Scheme discourage honest Taxpayers: The multilateral institutions such as the IMF and World Bank had principally opposed all such amnesty scheme and recommended in their policy advice to refrain from stepping into such controversies because it discourages honest taxpayers.

Lack of Transparency: Earlier, the Financial Action Task Force (FATF) had also expressed concerns over the latest Amnesty Scheme and it was one reason that now the IMF had extended opposition to this scheme.

Opposition Parties Have Also Raised Their Voice Against Tax Amnesty Scheme

Pakistan Tehreek e Insaaf (PTI) And Pakistan People’s Party (PPP) member’s national assembly has opposed the scheme as well. They expressed their concern that his amnesty scheme is like a smack on the face of honest taxpayers of the country.

FBR: This tax amnesty scheme introduced by the government also faced rigid opposition from the Federal Board of Revenue over offering amnesty on domestic assets and revisions in tax structure for individuals, Association of Persons (AOPs) and realty sector.

Under The Scheme

All the undeclared incomes earned before June 30, 2017, on all local assets (gold, bonds, property etc) can be legalized on a payment of 5% penalty.
The foreign assets holders could bring their undeclared foreign money in the country by paying a 2% penalty.

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