Responding to public opinion and scathing criticism following Panama Leaks disclosure, the British government has imposed 15% tax on all second home buyers operating through offshore accounts. This is what differentiates between a first world country and third world nations like Pakistan, where Finance Minister announces on floor of parliament while presenting Federal Budget to impose 10% tax on actual profits earned from real estate sales if sold within 5 years, only to retract it.

This has become a routine in Pakistan that every government announces a major tax imposition to curtail black economy, and then negotiates with known tax evaders to either withdraw or dilute it, thereby consolidating Black Economy. It seems in Pakistan “Only Fools Pay Taxes”. In the First World countries where tax to GDP ratio is high, representation comes with taxation, while state invests in development of human resources by investing in education, health and provision of security and basic necessities of life. In Third World, it is the affluent who get tax reliefs, the documented economy shrinks, black money is parked in tax free real estate and tax evaders dominate parliament with corruption or bribery openly patronised.

Another factor common with corrupt Third World countries is that their ruling elite continues to be beholden to their former colonial masters, contributing to their economies by pilfering their own national exchequer and buying properties, assets and business there, announcing mega projects which offer kickbacks.


Lahore, August 21.