In the Supreme Court of Pakistan, Suo Motu Case No. 2 of 2018 re ‘Maintaining of Foreign Accounts by Pakistani Citizens Without Disclosing the Same/Paying Taxes,’ is still pending for adjudication. It started on February 1, 2018 and after many hearings, appointing of committees and seeking assistance from a number of leading lawyers and experts in fiscal, business and finance, remains unconcluded till today. The last hearing in this case was held on January 14, 2019 as per website of Supreme Court of Pakistan.

The purpose of the suo motu case, as per order dated June 12, 2018, reported as PLD 2018 Supreme Court 686, was retrieving looted wealth and untaxed assets stashed abroad, exposing and punishing the culprits. On the contrary, the culprits were offered unprecedented immunities and amnesties and assured complete confidentiality through unconstitutional laws, first by the government of PML-N, and then again by the coalition led by the Tehreek-i-Insaf (PTI).

The immunity laws of 2018 & 2019 were not only ultra vires of the Constitution of the Islamic Republic of Pakistan, 1973, but also promulgated during the pendency of Suo Motu Case No. 2 of 2018 and Constitution Petition No.72 of 2011, filed by Muhammad Ali Durrani, former Senator and federal minister, attached with it, involving many common issues, no action is taken on till today.

Tackling the twin menaces of black money and tax evasion has always been a challenge and failure in Pakistan. The study, ‘What is hidden, in the hidden economy of Pakistan? Size, causes, issues and implications’, by Ahmed Gulzar, Novaira Junaid and Adnan Haider, shows that corruption and tax evasion are not only causing an expansion in the size of the informal economy, but also hampering the growth rate, thereby adding more to economic uncertainty, income inequality and poverty. Successive governments in Pakistan—military and civilian alike—instead of dealing with these issues have been pardoning and appeasing tax evaders through various laws and amnesty schemes.

The ever-growing informal economy, which is ironically called ‘The Secret Strength of Pakistan’s Economy,’ has grown to the extent that tax gap is now over 200%. The real tax-to-GDP ratio, if we take into account the monstrous size of unreported (untaxed) economy, will be much less than claimed at 9.2 percent in the fiscal year 2022-23.

The situation this year is going to be worse, as debt servicing is expected to reach Rs. 8.5 trillion against the budgeted figure of Rs. 7.3 trillion. This is all happening when the accumulated size of the informal (untaxed) economy is around Rs. 1000 trillion.

The Federal Board of Revenue (FBR) in fiscal year 2022-23 collected Rs. 7.169 trillion against the original target of Rs. 7.4 trillion. After the transfer of........

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