Study Finds Most Pakistani Lawmakers Fail to Pay Taxes

Posted December 12th, 2012 at 12:50 pm (UTC-5)
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A Pakistani investigative journalism group says less than a third of the country's lawmakers filed income taxes in 2011, bringing into focus longstanding complaints about high-level tax evasion ahead of elections set for next year.

The Center for Investigative Reporting in Pakistan said most of the country's 446 lawmakers and about two-thirds of the government's 55 Cabinet members failed to file tax returns last year.

The group's report released Wednesday focused on the secondary incomes most politicians have and did not take into account the money automatically deducted from their government salaries.

It found that politicians who did file often paid very small amounts. The report said the lowest-paying member of the senate who filed, Mushahid Hussain, paid less than $1 in income taxes.

In an email to Reuters, Hussain disputed the report's findings, saying he was not a senator at the time and that his source of income was his family's agricultural holdings, one of the many areas of the economy exempt from taxes.

Pakistan has one of the lowest tax-to-GDP rates in the world. The country's flawed tax system has long been an issue with foreign donors who provide Pakistan with billions of dollars a year in aid and support bailout programs for the country from financial institutions like the International Monetary Fund.