How unfair is fair  

Mahmudur Rahman   | Published: July 24, 2018 21:31:06 | Updated: July 24, 2018 22:17:36


The public jury has long ago sentenced the middle and higher income groups to hard taxation in the interest of the majority of the have-nots as well as keeping the wheels of development turning. That, as has been concluded, is fair. Natural justice determines that the more affluent has a duty and responsibility to do so and the government shall collect such taxation. It's all very well and good if, and that's a big if, everyone paid their full quota. That they don't is where the discretionary power of the taxman is so often criticised as going against fairness. Those that should pay more don't; the ones that do are repeatedly probed and prodded. Somewhere someone has missed the point. If there can be anomalies in collection and reporting there can be slips in filing and payment. Advance Income Tax is easy to deduct but difficult to claim back because the base of taxation can change slabs fairly quickly. And it's always adjusted against future tax, never refunded with or without value addition or interest.

But it's when the National Board of Revenue (NBR) reminds us to take our receipts at structured retail points that the two really odd features of unfair taxation appear. Shopping at any decent store attracts VAT that is to be a maximum of 15 per cent. If one buys a pizza, the receipt will only say that VAT and applicable Supplementary Duty together makes up for the 22 per cent that is charged to the conner. In other words, there's an additional seven per cent the consumer pays and never really gets told what that comprises. The same thing happens at supershops and it would appear that the convenience of getting most stuff under one roof is neutralised by something called applicable taxes.

Advance Income Tax charged at the time of vehicle fitness certificates is imposed irrespective of whether the consumer pays tax and is almost like a non-interest bearing loan to the government. That's well and good except that the massive fraud and often open ostentation raises questions about efficiency of spend that the citizen has very few, if any platforms to ask from. In the United States or the United Kingdom online submissions are made easy and refunds are prompt in case of over-taxation. The Finance Minister smiled wryly when asked about all the unfair extortions from business persons during the caretaker government's last tenure. Not only is there no mechanism of return of the money, no budget speech ever mentioned where all that money went and how it was spent. The Comptroller and Auditor General's office asks questions of a disparity between revenue reporting and collection. Even it did not question the moneys that flowed in or where the expenses were made.

Tax Ombudsman offices should be opened in every district just to ensure fairness and, combined with a more lively consumer cell in the Ministry of Commerce, address injustices as are canvassed. Otherwise, the concept of fairness is opaque as every citizen will agree. Life just isn't fair.

mahmudrahman@gmail.com

 

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