The increase in the punitive powers of the Inland Revenue might seem to be an administrative measure aimed to broaden the base, but it may well have the opposite effect. The Finance Bill now allows taxation officials to have a taxpayer arrested if he or she thinks there has been an offence. The official can then detain that person on remand. This gives taxation officials power to detain anyone at will. Considering how the government’s use of NAB, which has similar powers of arrest and detention, has attracted adverse comments from the Supreme Court, empowering taxation officials might merely prove a means of enabling the government to persecute political rivals. The way that Supreme Court judge Mr Justice Qazi Faez Issa and his wife were targeted by the FBR, until the Supreme Court’s recent decision in a review petition, shows that its services are being favoured. If the FBR got more teeth, it might end up being used against the regime’s opponents.
Whether or not it is so used, it will provide another excuse to businessmen anxious to avoid the tax net. Instead of widening the tax net, it may lead to its narrowing or virtual stagnation, as individuals do their best to get out of the tax net. Going by past experience, taxation officials will find ways to use these newly granted powers to enrich themselves. Since the collection record set this year could only have been achieved by giving up some of the perks of the job, the new powers seem designed for taxation officials to make up past losses. It also opens up the prospect of an attempt to imitate Saudi Arabia, where a large number of officials were arrested, and kept at a hotel until they coughed up money.
Such laws, giving any department arbitrary powers of detention are not in accordance with the rule of law. The government is likely to find the new powers challenged in the courts, which already have been taking a dim view of the power of the executive to use laws meant for offenders harming all of society to persecute political opponents.
