The Senate Standing Committee on Finance and Revenue on Thursday recommended amendments to the anti-money laundering laws.
The meeting of the committee, held with Senator Saleem Mandviwalla in the chair, noted that the anti-money laundering laws were being misused.
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Committee member Farooq Hamid Naek lamented that these rules are applied to everything in Pakistan to please the Financial Action Task Force (FATF). After deliberations, the committee recommended amendments to the anti-money laundering laws at the earliest possible time.
On the subject of broadening the country’s tax base, committee member Kamil Ali Agha stated that if tax revenue is to be increased, people must be encouraged, and intimidation will not help. He went on to say that all the black money is with the property owners and they should not be allowed to escape the law.
Federal Board of Revenue (FBR) Chairman Asim Ahmad said that the tax regulator will consider all of the committee’s recommendations and provide an update on redressals in a timely manner.
Notices to Business Persons
The committee also reviewed the case of notices issued by the FBR to businessmen under the Anti-Money Laundering Act and expressed concern about the frequency with which the regulator has issued notices thus far. Saleem Mandviwalla urged the FBR to be extra cautious in investigating all such cases. He said that unjustified issuance of anti-money laundering notices would further reduce the country’s tax-to-GDP ratio.
The committee was informed that notices are only issued under Anti-Money Laundering Act for tax evasion of Rs. 10 million or more. It was also briefed that tax-related crimes are investigated under international law, including the Vienna Convention.
FBR Chairman informed the committee that only 254 cases have been prosecuted under the Anti-Money Laundering Act in the past six years and added that notices have been issued only on the basis of concrete evidence.
