INTERVIEW WITH ZIAUL MUSTAFA, PRESIDENT ICMA PAKISTAN

KHALIL AHMED
(feedback@pgeconomist.com)

Apr 2 - 8, 20
12

PAGE: TELL ME SOMETHING ABOUT YOURSELF PLEASE.

MUSTAFA: Positions held at ICMAP: I have been elected President of Institute of Cost and Management Accountants of Pakistan (ICMAP) in 2012 for the next three-year term. I am the youngest President since the institute's inception in the year 1951, which signifies the emerging trend of young leadership in the professional institutions. Previously, I served the institute in various capacities such as honorary secretary, Chairman and Secretary of Lahore Branch Council, Chairman of Journal and Publications, Research & Development and CPD Committees.

PROFESSIONAL CAREER: Presently, I am the CFO & Business Administrator of Expo Lahore (Pvt.) Limited, a Joint Stock Company owned by the Federal Government through Ministry of Commerce and Punjab Government through Industries Department with a mandate to develop and operate Lahore International Expo Center. I am engaged with Expo Lahore since its inception and played a vital role in developing the project feasibility, project financing, project management, and implementation. The Expo Center is the most modernized and well-equipped venue in context of its infrastructure and support services and it is playing a vital role in the promotion of trade and economic activities in the country through trade exhibitions.

PROFESSIONAL EXPERIENCE: I have vast professional experience in manufacturing, construction, engineering, and services sectors. I also have diversified experience as an educator, a corporate trainer, and management consultant. I also worked on mega infrastructure projects such as Mangla Dam Raising Project and Mirani Dam Project.

AWARD AND HONOR: In recognition of my meritorious services for Expo Center Lahore, I received an award by the hands of the then Prime Minister of Pakistan at the time of inauguration of Lahore International Expo Center.

PAGE: IN YOUR VIEWS WHAT WOULD BE THE THEME OF THE UPCOMING BUDGET?

MUSTAFA: The theme of the budget should be tax on property, reviving the economy, and promoting investment, power generation, prizes on sales tax receipts, effective monitoring, and risk-based audit, improving tax-compliance, agriculture tax, sales tax on services, and capital formation.

PAGE: DO YOU THINK THAT THE IDEA OF GENERATING REVENUE THROUGH BROADENING TAX BASE IN THE UPCOMING BUDGET IS GOOD?

MUSTAFA: Nothing is certain than death and taxes for everyone in the society. Death is an act of God whereas taxation is the act of the elected democrats (parliamentarians), who inflict burden of tax on their fellow fellow citizens. The burden of taxation, particularly of indirect taxes, such as sales tax, federal excise duty and such other taxes have a direct bearing on the family budgets of the low-income group families.

No doubt, taxes provide a major source of revenue for the government but unfortunately, instead of taxing the elite class and agriculturalists, the burden of all taxes fall on the salaried and business class. Unless and until we do not take bold initiative to collect taxes from those persons who live in luxuries but pay less or no taxes at all, we will not be able to generate more revenue. The middle and lower class are already heavily taxed that coupled with the rising inflation makes it difficult for them to make the both ends meet. I would suggest to the government to give some relief to the salaried class and the industry so that business could flourish that would ultimately lead to more revenues for the government in future.

PAGE: PLEASE ELABORATE TAX LAW REFORMS IN THE FUTURE BUDGET.

MUSTAFA: The existing tax structure in our country is quite uneven, with major burden falling on the lower and middle class, whereas the rich and powerful class of the society do not pay their due share to the national exchequer. I think that concessions and exemptions allowed to the privileged class of our society should be abolished forth with and taxes collected from them should be equitably spent for public welfare. As a matter of fact, taxes should be the source of industrial development and socioeconomic growth; but unfortunately this principle is ignored by the budget makers.

Frequent changes in tax legislation have made the overall tax structure incoherent and tax base narrow, which has played a key role in lowering tax-to-GDP ratio in Pakistan. The efficiency costs of the tax system to the economy is also very high. A number of tax reforms could be taken that should be based on achieving the following priorities:

(1) Broadening of tax base by including tax-free segments
(2) Fool-proof system to check tax evasion in the society
(3) Limited contact between taxpayer and tax collector
(4) Bringing equity of tax regime
(5) Reliance on automated computerized system

PAGE: IT IS BEING SAID THAT THE FIFTH CONSECUTIVE BUDGET DURING THIS DEMOCRATIC ERA WOULD BE PRESENTED WITH A SPECIAL FOCUS ON PROVIDING RELIEF TO THE POOR MASSES WHILE KEEPING IN VIEW THE GROUND REALITIES. YOUR VIEWS.

MUSTAFA: I do not think that the upcoming budget will offer any special relief measures to mitigate the miseries of the poor at large. There should be a special package in the budget for investment and employment opportunities in the near future. Investment would be possible as long as security and energy situation in the country is stable. Revival of the national economy would be possible in two to three years when the security situation stabilizes. In the next budget, relief must be announced for the general public.

PAGE: YOUR COMMENTS ON THE BILLIONS OF RUPEES ALLOCATED FOR THE ENERGY SECTOR IN THE LAST BUDGET.

MUSTAFA: I think that the government has to work on war footing basis to tackle the energy crisis in the country, and this is only possible by resolving the circular debt issue. As per the statement of the Federal Minister for Petroleum and Natural Resources on the floor of National Assembly, the power sector circular debt increased to Rs396.7 billion by March 15, 2012, which is Rs326 billion or 465.7 per cent higher than the debt in March 2008. In fact, the government has failed to resolve this issue. Long hours of load shedding are continuing and that has badly affected industrial production. People are losing jobs by closure of industries and the exporters are finding it difficult to meet their export targets. Therefore, the government should realize the gravity of the problem and urgently resolve the circular debt issue.