VAT the heck is this but a messy job turned messier still

On that day, the first of January 2024, the axe fell sharply on the necks of millions of people of this politically ravaged nation once called “The Resplendent Isle”.

The night before that guillotine blade dropped, some one percent or less of our country’s glitterati danced away the troubles of the rest of the population and drank till dawn to forget the desperation of the struggling poor, spending a minimum of Rs 20,000 per head for a seat at some fivestar hotel.

Among them surely were politicians and others who people believe had fattened themselves on 25% percent (plus 18% VAT now) on underhand deals on everything from life-saving medicines to sugar purchases to garlic to public utilities and every single transaction where money changed hands, bypassing procurement procedures despite the IMF’s noisy rhetoric and the government’s grand display of pretentious anti-corruption laws that seem to exclude—not strangely, of course—the political class of whatever party hue.

One cannot forget the politicians who seemed to be burdened with swiftly fading memories and their sheer forgetfulness to submit their declarations of assets and liabilities. On the last count, only 12 out of the current 225 MPs had done so as required by law.

But nobody appears to be bothered about it, though we hear patriotic clap-trap about catching thieves and hanging them on the cadju pulang tree as we used to sing in our college days at annual cricket matches.

Surely, with all the monies collected by means fair or foul, there must be amongst that lot those who have assets abroad, which should also be declared, according to law, though some of them might appear as paragons of law and order. Why have these indiscretions, if one might pardon an understatement, not been pursued by those who have the authority to do so?

Is it because those at the top who should order such investigations themselves are among those who have not submitted their asset declarations to the relevant authority?

Instead, what do we find? The Central Bank Governor, named Nandalal Weerasinghe, trying to muscle into territory that seems to be already occupied by Public Security Minister Tiran Alles and his faithful sidekick, like the fictional Tonto.

Governor Weerasinghe is cited on a local news website as having “urged the public to become informants to broaden the tax net and thus reduce both overall direct and indirect taxes”. Is squealing on each other the new direction the country is heading in?

What is the Central Bank chief trying to do but entice the people of this country to spy on each other and squeal to the authorities on their neighbours, associates and more likely on their enemies to embarrass them, causing increased divisiveness in a society already wracked by ethnic and religious fissures that still fester?

Just because the Central Bank has been given the licence of independence by a recent law, it surely does not mean that he can promote a parallel spy service, a new breed of stool pigeons, something like a Central Bank Whistle Blowers Association.

Here is a bank that found that bundles of money that had been locked away one weekend in some location accessible to only a few had suddenly disappeared from their place of safety. After alarms were raised and much frantic searching for days, the money was eventually located elsewhere. But the whodunit has not been revealed—at least the public has not been told about it, as far as one knows. Where is Nandalal's squealing service?

Yet the same governor who lost—at least temporarily—his bank’s money now wants to turn our society into one where one would spy on another and even falsely accuse rival corporates, bribe takers, or others supposedly with undeclared gains.

If Governor Weerasinghe is so concerned about the government collecting its share of the unpaid loot in the way of taxes, he need not try to set one citizen against another. All he had to do was take a stroll into some of the fivestar hotels on the 31st night. He might have found enough tax dodgers celebrating the end of another year which has passed without having to pay government taxes.

So much has been heard in the last months and recent years about alcohol manufacturers who have defaulted on millions of rupees in unpaid taxes. We have heard of casino owners who have done the same for years, untouched by hand or law.

Yet what have the government and the institutions it has established with high-sounding names for the very purpose of collecting taxes or prosecuting them in default done about it? A bloody fat lot of empty talk or deadly silence because some of those who should be doing their job of forcing payment out of the defaulters have failed to do so. And why, pray? Because they are probably part of the problem.

Why have successive governments not gone after them? The answer has been blowing in the wind for decades, as is very well known to Sri Lankans at home and abroad. They are either supporters of one political party or another or all donors to all major parties at election time or any time when funds are needed for party events.

For years, we had read or heard of people—not necessarily committed supporters—being bussed to meetings and other events from distant places with a pay-off in bottles of free booze, a lunch and a bundle of cash. This is not speculation, for it has been known since the days I first entered journalism in 1962.

And what of the fat cats who have taken huge loans from state banks, often more loans on top of other unpaid loans, with the help of insiders and outsiders, and not paid back what they owe the state? And their unpaid millions and billions written off with the lighting of firecrackers at home.

On the other hand, small businesses struggling to survive under the burden of taxes and increased utility and other costs are being parate executed, so to say, as though the death penalty has been hastily revived.

Just the other day, I read Trade, Commerce and Food Security Minister Nalin Fernando gloating over the great gains awaiting the people come March, when living costs would plunge by 75% and we can all gather and sing glory be to the new messiahs from the ruling class and the Central Bank.

He is said to be a member of the Pohottuwa party. Isn’t that the party that is now trashing the new taxes, having faithfully supported all those new burdens by raising their greasy hands when the 2024 Budget was voted on late last year and helped President Wickremesinghe to steer the budget through?

One question for Minister Fernando, though. Will he plunge himself—hopefully—into some deep, dark hole 75 feet under the garbage collected in Diyawanna Oya so that he will disappear from political life if his glorious prognostication proves as empty as Mother Hubbard’s cupboard?

If successive leaders and their governments that now preach neoliberal baloney while selling our nation’s assets—both failed and profit-making so their fat cat cronies at home and abroad can benefit from the harvest— had collected the revenue due to the state and others who stashed away robbed assets were made to return them under threat of years behind bars, would we have had to tax the poor with an unbearable VAT and drive away our professional classes with heavier taxes?

Would this soured mess not qualify as a breach of public trust?