On February 15, Pakistan became one of only four countries in the world that make tax records public. The other three are Norway, Finland and Sweden. A year ago, no one would have thought this was possible. Pakistan, after all, is a cesspool of corruption and a paragon of opacity. But check the website of the Federal Bureau of Revenue and you’ll find prominently displayed there a link to the Parliamentarians’ Tax Directory. Click on the link and you’ll get a PDF that lists how much income tax each and every member of Parliament paid in 2013. On March 31, a similar listing will be made publicly available for the tax payments of all citizens.
How in the world could this happen in Pakistan?
A large part of the credit should go to the intrepid Umar Cheema, founder of the Center for Investigative Reporting in Pakistan (CIRP), which in the past year published two well-documented reports that showed tax evasion on an epic scale. The success of this project inspired me to take up this blog again after several months of inactivity. It’s not always that investigative reporting makes such clear and dramatic impact. So it’s a good time to revisit a question that’s often asked: What kind of reporting makes an impact? What stars must align for reforms to follow in the wake of an exposé?
In the past two weeks, I have been lecturing my students about the importance of crafting the investigative narrative and engaging readers. Good narratives make impact, I said. Yet the two reports that the CIRP has published are densely written, numbers-packed pamphlets, each about 70 pages long. There are no sexy graphics, no stunning multimedia, no gripping and polished stories. The prose is dry – they could well have been written by the World Bank. Moreover, the reports confirmed what people in many developing countries already know: The rich don’t pay taxes. And yet they captured the popular imagination and forced the government to do the unthinkable. Why?
Pakistan is a basket case in terms of tax collection. It has one of the worst tax-to-GDP ratios in the world – just nine percent, worse even than Afghanistan’s 11 percent. Three years ago, the finance minister told parliament that Pakistan’s ratio was second to the bottom among 154 countries. Yet nothing was done.
In December 2012, the newly formed CIRP released its first report, which showed that two-thirds of Pakistani MPs did not pay taxes. Neither, it said, did the high-living, polo-playing, playboy President Asif Ali Zardari and more than half his Cabinet. The findings got wide play in Pakistan’s free-wheeling press. Perhaps it was the specificity of the details, the fact that it named and shamed and put precise numbers that showed the extent of the tax evasion – the report caught fire and stoked the public anger. (I wrote how that project was researched in an earlier post.)