7/31/2019 Pakistan's Land and Tax Reforms
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Land & Tax ReformsBy Asif Punjwani September 1, 2012
No party can have a clear Economic Policy if theydont have a
crystal clear philosophical view of the roleof State vs Individual
rights. I am not being critical ofPTI here. All I am saying is that
there is more room forsome honest talk with the Pakistani
Nation.Consistency is key to stability. Exclusions andexceptions
are admission to intellectual failure.
Lets not fight the human nature. Lets admit we allwork in self
interest. If my child falls along with yourchild, I will save my
child first. If I can cheat the system
legally, I will. The line between HAQ (truth) and HAQEEQAT
(reality) will always exist. If
Prophets couldnt remove that line, our chances fall below zero.
Lets exploit the nature ofmoney to make the wheel of commerce move.
Let us be accountable to each other. Here is oneway the Land/Tax
reform should be handled.
1 Ask the public to submit claims to their land. Set a deadline,
say 2 years. If the land isnot claim till then, its put in a public
escrow account for 3 years before a public auction
2 Let its owner access the value of his land and submit it to
the Government. If the landvalue seems too low, the Titlement
Office should have the right(only if proposed value isless than 30%
of market value) to buy that land for amount submitted by the
owner.
3 Implement a 0.1% yearly Property tax on the property value.4
Owner failing to pay taxes over 3 years, wouldnt be allowed a title
transfer on property
sale till the outstanding taxes are cleared. Once outstanding
taxes equals property
value, the property be seized and the balance be settled after a
public auction.
The benefits of a policy like this is that is discourages idle
capital. A rich man wont simply buyfarm land for expected future
gains and not use that land as there would be a cost associated
toholding that asset. Ex-pat Pakistanis who own properties wont
lock up their homes for decadesbecause there would be a cost in
holding those properties. These locked up assets are notproducing
an economic value. The satisfactory part of the policy is letting
the owner estimatethe value of his property. Value (Rs/sqft)
falling below 30% from its surrounding propertyaverage should
trigger an audit. The owner wont lowball the price in fear of a
buyback from theGovernment and he wont jack the price too high to
avoid higher taxes. Theres penalty ofdefaulting on taxes as the
owner risks losing the entire property. Also profits from selling
seizedproperties should be shared with the Governments Tax
prosecution department employees and
management. This would give them person incentives to go after
the lands of Tax defaulters.
Eliminate all other forms of Federal taxes. Income, Sales, GST
and every fancy worded taxshould be wiped clean. Sure you can have
a municipality sales tax to fund schools, hospitalsand public
welfare.
Look at it at a personal level. Those public roads that take you
home, those schools that youllsend your kids to, that common
defense, a justice system, all require a steady stream offunding.
If your enemies are going to pay for you, you my friend are going
to pay dearly.
