No more misuse

The Commission for Investigation of Abuse of Authority (CIAA) has given an order to the concerned ministries, corporations and departments to make public the names of those who have failed to return government vehicles. This move comes after former prime ministers, parliamentarians, former justices and the assistants of former ministers paid no heed to an earlier CIAA order to return such vehicles. This is a right move and it will help the CIAA take stock of government property on wheels. Besides, such a disclosure of names will also help persuade the offending individuals to fall in line. This is the first time the CIAA has felt compelled to take such drastic action against government vehicle misusers. Had the CIAA displayed the same robust determination to recover state owned vehicles earlier, it would not have taken so long to recover them. The bigwigs involved would not have taken the CIAA order so lightly. The anti-corruption body should now take a similar approach to some state corporations which have failed to register their own vehicles. Some of these vehicles are taken by senior officials for their own use and never returned to the corporations even after they retire. The CIAA is on the right track in seeking to prevent further misuse of government vehicles.

Last April, the Parliamentary State Affairs Committee (SAC) had blacklisted more than fifty politicians, judges and government officials who had been misusing government vehicles. The vehicles misused belonged to various ministries, corporations and departments including Nepal Electricity Authority, Nepal Telecommunications Corporation and the Departments of Roads and Forests. The vehicles ranged from Pajeros and Prados to motorcycles and even two bulldozers from the Department of Irrigation. Some of the vehicles had been kept for as long as twelve years. Prime Minister Sher Bahadur Deuba himself had kept a motorcycle and a jeep which belonged to the Nepal Oil Corporation until he became Prime Minister for the second time. Like Deuba then, there are dozens of politicians, judges and government officials who are still misusing government vehicles. They misuse them even on public holidays when government offices remain closed. In a variation on the practice, some have rented vehicles for personal use with payments made out of the government treasury, while others have replaced old vehicles through the misappropriation of state funds.

The Deuba government must own up to earlier misuse of government vehicles. That will set a good example for others and make the work of the CIAA that much easier. The CIAA for its part should pursue the matter to its logical conclusion so that a powerful precedent will have been established. Government officials, politicians and judges have not only kept vehicles for years but also flagrantly misused them on public holidays. Let us hope the government now takes this matter seriously and prevents further misuse of vehicles.

Improving tax governance

By Satyendra Timilsina

The shortfall of government revenue against the budgetary target has been a regular feature in our country. In the last year too revenue collection fell short of target by almost 3 billion rupees. Behind this under performance, according to some experts is ad-hoc targeting of revenue collection, but the major reason can be said without any hesitation, to be poor tax administration. The lately introduced VAT, to some extent has been able to bring collection nearer to the targets. Statistics available so far show that revenue collection from VAT almost hit the target last year whereas the revenue collection from other tax sources has not even come near the estimation.

The different tax sources that were brought into the taxation net a long time back are still awaiting proper implementation. As an example, the house rent tax that was introduced some three decades earlier contributes just around 3 per cent to income tax revenue. It was found that just around 9 thousand people paid house rent tax in FY 2000-01. Out of the four income tax categories considered in an economic survey, all tax sources other than the rent tax have brighter prospects of yielding significant increases in tax-revenue collection, provided that tax administration is made more efficient.

At present, two vital changes are to be noticed regarding the improvement of tax governance. The first one is the formation of the Inland Revenue Department, which merges the then Income Tax Department and the central level VAT office, and the other is the proposed Income Tax Act 2001.

With the aim of reducing the government’s regular expenditure and making the tax administration more efficient, the then Income Tax Department and, the central VAT office were merged into a single Inland Revenue Department last April. This Inland Revenue Department has started functioning as a new department. The existing 33 district level income tax offices and 21 VAT offices were reframed into 21 district level inland revenue offices and 15 window offices last month. After formation of the new organizational setup, taxpayers are said to have benefited in several ways. The tax administration is now believed to be more efficient. This is said on the ground that the administrative cost of the government will decrease, all information on any tax issue will be provided at one place and a new organizational set up has been formed to support the new department. The department is also said to have been conducting training for its officials in order to boost performance.

The second vital change for building an efficient tax administration, a new income tax bill, is in parliament awaiting final approval. This bill is said to be clearly defined and complete in itself. With the enacting this new law, it is expected that the department will be able to solve all tax related problems itself. The new bill defines income sources more clearly, has superior provisions, is equitable to all taxpayers, and will help in upgrading the efficiency of the tax administration. The bill is expected to come before the public soon.

The major attempts mentioned above regarding improvement of the tax administration are definitely praiseworthy steps. But the basic question common people often raise regarding tax governance is about the prevailing corruption and the negative approach of tax officers. What about the tax personnel with low academic background and without adequate knowledge of taxation? Such personnel are not even aware of the tax rules and the provisions of the tax act. And what about the tax employees whose productivity is already gone? Nothing ambitious can be expected from them. Yet they are
the regulators of the government machinery and if the regulators are not working properly, what can be done by just polishing the machine?

Several reports of undervaluation of imported goods at the customs office with the importer and the tax official acting together have also been heard. It was not so long ago that the revenue investigation department caught the Tatopani Customs Office involved in such irregularities. An investigation found that an official at the customs office valued electronic equipment at far below real price. This sort of activity has caused the transfer of government revenue to the pockets of some individuals. Likewise, one of the major government sources of revenue, VAT, can also be increased with a proper billing system. Though, the government has taken some steps in order to encourage a proper billing system through the current budget, it has not been that effective to date as the rules and required guidelines are yet to be formed.

At a time when everybody is expecting efficiency in tax governance, a major step the government and the revenue department has to take is identify capable candidates and place them in the right positions, phasing out the inefficient ones with suitable packages. The revenue investigation department has to be made more efficient, strong and action oriented in order to monitor the malpractices going on all over the tax offices. Also, the use of revenue police, a concept that emerged some time back, might be helpful in controlling corruption and providing necessary tax security to taxpayers, thereby enhancing the effectiveness of the tax administration. Unless there is a proper monitoring system, improvement in the tax administration cannot be expected. As the basic requirement for good tax governance is proper functioning of manpower rather than policy level changes, it is inevitable for the IRD to take some major steps to change the attitudes of tax personnel.

When convinced is not so convincing

By BJ

Recently the Immigration Counsellor of the Canadian High Commission based in New Delhi clarified that their visa officers are obliged to refuse visas when they are not convinced that an applicant complies with Canadian immigration laws and regulations. That was when the Nepali side demanded the reason for denying visas for four cricket team members heading towards Toronto to participate in an ICC Trophy match. Whatever the reason, this for sure jeopardized the dream of the Nepali cricket team, which had been looking forward to the match to show their talent and toil.

"I am not convinced". This seems to be the final convincing phrase of American English speaking Embassies like that of Canada and the United States of America. It might be quite convincing justification for the consular division of any Embassy, but the visa applicants are not convinced and they deserve to know why the visa officers are not convinced of their application. Otherwise how could one improvise oneself for the second chance? Does this phrase mean "once a visa denial always a denial"?

An aspiring visa applicant goes through lots of pressure before facing the interview. He does everything to establish an impression in the eyes of unpredictable visa officers and bag a visa, but unfortunately the visa officers (very often) flips the pages with a you-will-never-get-visa kinda attitude and get rid of the applicant with that very statement "I am not convinced that you will come back". Are these visa officers reincarnations of the Gods? Otherwise how could they know if somebody will come back or not? That also without asking any questions and just pretending to look into the papers. Do they read human minds or is something of this sort written on the forehead of each visa applicant which only those officers could read? The applicant can’t even know the reason why his visa is denied. After the "I am not convinced" final statement, these officers’ mouths get sealed.

A Canadian Embassy does not exist in Kathmandu but the Nepali people have learnt lots of hard and humiliating lessons from the American Embassy. Out of 200 applicants a day, most probably 190 of them have to lend their ears to this phrase in less than three minutes after they enter the room for the formality-interview. This is our plight. The Nepali citizens regarded as bold and brave, are being robbed and ransacked by foreigners not abroad but in our own country. They are robbed monetarily, physically, mentally and socially.

Each time they face an interview, they are robbed of 45$. They have to be physically mobile to get everything ready for the interview, from depositing the visa application fee with the mediator bank to collecting the bank balance certificate whereby an applicant is robbed of another couple of hundred rupees by the bank which instead of providing a cooperative clientele service goes for "maukama chauka". After all this hassle the applicant is turned down and goes through depression and mental disorder. It is quite obvious; when a person is ready for the sky it’s demoralizing to come back empty handed. Even the proverb says "when you reach for the sky, you may not get the stars but even then you don’t return with your hands full of mud". But in this case, there is no luck for this dirty mud either. Then comes the social issue. It’s really a big shame for deserving people not to get the visa. It becomes a social issue, a matter of prestige and status.

Every Embassy reserve the right to accept or reject any application without assigning any reason but in today’s world where we always talk about equal human rights, modernization, democratization and globalization, how could we forget the basic – humanity.

For a developing nation like Nepal, countries like the US, Canada, Great Britain, Australian, etc. could be a platform for a better future, in terms of higher education, exposure, monetary gain etc. and America has always been regarded as the land of opportunity. Why then should there be such an unconvincing bar against humanity aspiring for that chance.

 Duplicity and us

By Pratyoush Onta

On 22 June 1999, as part of its regular Tuesday discussion series, the discussion forum of Martin Chautari organized a public discussion on the topic of "Boarding Schools, Government Schools: Leading to Two-Class Oriented Nepal?" Many participants spoke with anger about the way in which private schools had been charging fees of their wards. Computer and lab fees had been taken from tiny tots, library fees had been charged even when the school did not have a functional library, and admission fees were being collected from each student each year. In other words, the participants felt that the private schools were fleecing the parents.

Some months later, on 13 October, this writer held a discussion on the same topic in Radio Sagarmatha over the talkshow, Dabali, which I used to host then. One of my guests, Krishna Hachhethu, one of Nepal’s most insightful political scientists, stated that sixty-five percent of his monthly salary from the Centre for Nepal and Asian Studies, goes towards the fees of his three children. Highlighting that his father had to spend no more than five percent of his salary on the education of his children, Hachhethu discussed how the rising fees charged by the schools had forced him to do consultancies that did not add up to his academic research. He said, "If the practice of charging exorbitant fees from their wards can not be monitored by the schools themselves, it will lead to a full-fledged two-class and corrupt Nepali society."

These discussions had occurred at a time when the various associations of private and boarding schools – the PABSONs and NPABSONs – were too busy fighting with each other over organizational spoils and with the government to extract more facilities for their own trade. Establishing fair, transparent and robust mechanism for self-regulation of the fee-regime and for punishment of those members who did not follow organizational guidelines was far from their agenda. Sane and modest demands on the part of parents for a fair fee-regime went unheard. Justifiable claims made by teachers for more secure working conditions under proper contracts were ignored. Instead of building a collective institutional and moral force that could withstand scrutiny from other legitimate sources and deny extortionary demands of weapon-carrying groups, these associations of private schools made the ground fertile for haphazard fee structures, unmonitored curricula and general educational chaos.

Surely some private schools were imparting good education. Others were charging justifiable fees for the educational services they were providing to the children. Some others even provided scholarships to students from economically disadvantaged families. These were all good deeds. However they were not enough to arrest the moral decay at the centre of the private school sector in Nepal.

If the Maoists have now attacked private schools, the latter have none to blame but themselves. Anthropologist Saubhagya Shah has recently argued that the Maoists have taken advantage of the duplicity present in every sector of Nepali society to develop their vicious campaign. The private schools proved to be no exception. The private schools have become victims of their own duplicity, and in the process they have alienated parents who have therefore not come to their support en masse.

That is why when the Maoists forced many private schools to close, the associations of private schools could not do anything but watch their members close their shops. Those that are still open outside of Kathmandu, it is now being said, are paying ‘donations’ to the Maoists. After the last round of a week-long private school bandh called by krantikari students, some people thought that perhaps a collective resistance to coercive denial of the opportunity for education of school children would emerge. Since that did not happen, some big Kathmandu schools have reportedly started to pay ‘protection’ money to the Maoists.

Similar developments have taken place in just about all the other sectors of Nepali society, including industry. Take for instance, the alcohol industry, very much in the news recently. In "The other side of the alcohol economy" (TKP, 19 August), Saubhagya Shah has provided a fine analysis of the ban against alcohol being demanded by the women’s Maoist organization. When local communities protested against the ravages of the alcohol epidemic long before the arrival of the Maoists in the scene, Shah writes, the "government and the industry either ignored or brutally suppressed" them. The current backlash against alcohol "is a result of the complete success of the liquor lobby in dismantling all state and social supervision and regulation in the production and promotion of alcohol in Nepal." In other words "liquor capitalists given free reign" ignored sane voices calling for moderation and failed to self-monitor their industry. As Shah writes, it is sad to note that they are now calling for "‘talks’ on the alcohol issue only when it came with the fire and brimstone of the Maoist women." Examples from other sectors could also be provided but we hardly need more evidence to argue that when mechanisms for all encompassing self-monitoring are not developed in business, industry, education, government, judiciary, media, non-governmental and other sectors – as has happened in Nepal – they become vulnerable to the extortionary demands of groups with weapons.

What is to be done then? Going back to the private school sector, we could consider the following only because experience has shown that the private sector has a role to play in school education in Nepal. In the short run, the most we can do as parents, teachers and citizens is to pay attention to how schools are responding to the attacks. For those that have closed, our job might be to look for ways to reopen them under modified conditions. For those private schools that are still in operation, we might want to explore possibilities with their management teams for building up a new moral force to withstand coercion.

In the long run, however, we have to figure out ways to create innovative and strong school associations that champion a fair role for the private sector in education in Nepal. These associations must be capable of self-monitoring in terms of quality of education imparted, fees charged and working conditions for the teachers. They must also be able to make the monetary transactions of their member-schools visible to their immediate community members. Without such investments in building a morally strong school community, private sector school education will always be susceptible to extortion from legal and illegal forces.