Pakistan: Why the private sector compromises on corrupt practices

Seminar on the private sector

The Seminar ‘Why the Private Sector Compromises on Corrupt Practices’ was held at the Hotel Avari in Karachi on the 22nd of June, 2009. The seminar was organized by Transparency International Pakistan in collaboration with the SITE Association of Industry. It was well attended by private sector, public, government officials, trustee and members of TI Pakistan. The seminar was presided by Dr Muhammad Shoaib Suddle, Federal Tax Ombudsman.

The seminar started with a welcome address by Mr Syed Adil Gilani. He gave a brief introduction of Transparency International Pakistan. He mentioned the efforts of the organization in fighting corruption and the achievements in its endeavor so far. He talked about the reforms in the FBR rules and its effect on revenue collection. He requested the Federal Tax Ombudsman to look into the cases (over five years) by the tax departments.

The second speaker was Mr Munir Qureshi, Member Customs, FBR. He said that we do not recognize weakness in the system but simultaneously we are working towards the improvement in the FBR. The concerns of tax payers are being given care and we do put in our efforts to have consultation bases solutions. He said that the perception survey has already improved the corruption rating of the customs.

Next Mr Abdul Qadir Memon, President Pakistan Tax Bar Association spoke about the tax reforms. He said that the tax reforms were to reduce contacts between the people and the tax administration. The tax reform of the last 7 years has resulted in meeting the targets of FBR. The Universal Self Assessment Scheme was a commendable job.

The next speaker was Engr M.A.Jabbar, Chairman, SITE Association of Industry. He said that corruption of the private sector is due to law statutes and other statutes that cover the business operations. There is a need to make amendments in statutes as well as building of institutions regulating the business. He said that the office of the FTO should be strengthened to address the problem arising out of misuse of powers by the tax functionaries.

The third speaker was Mr Nisar Sheikani, Chairman All Pakistan Textile Processing Mills Association. He explained that the provisions of tax laws as the main reason for forcing the business to compromise with corruption. He recommended that to decrease corruption the government should avoid unilateral policy formulation, adhocism and to ensure implementation of legislation.

He was followed by Mr Zubair Motiwala, Advisor to the Chief Minister Sindh on Provincial Investments. He said that present tax related laws have virtually built in corruption into them. His association has been contesting this at all possible forums with no result. The only solution was to revise and simplify the laws to make them business friendly.

A Question & Answer Session followed the speeches. Relevant questions were put to the speakers who answered the queries of the participants.

The concluding address was given by Dr Muhammad Shoaib Suddle, Federal Tax Ombudsman. He said that volumes have been written on corruption in Pakistan. He said that political will is required to curb corruption in the country. He said that laws and discretionary powers were tools of extortion. Both parties collude in specific matters related to revenue. He said that white collar crimes were ten times more than what ordinary criminals cost. He further stated that changing SRO conditions benefits some party and with the hiring of good lawyers they get away. He appreciated the efforts of TI Pakistan and said that we need to develop partnership with TIP to identify the areas to combat corruption in an effective way. He said he will look into the cases where companies have been asked for the total audit for all past five years. He also asked TIP to bring such cases to his attention and he would pursue such cases.