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Taxes, Cost of Living and labour unrest

Coming in the wake of disclosures that the Inland Revenue Department has failed to recover some Rs. 20,000 million in tax revenue from more than 50 VAT-charging major private enterprises, the parliamentary debate on the Inland Revenue Amendment Bill recently, made absorbing reading. Mounting trade union unrest, this time around in the Railway sector, which finally boils down to the basic essentials of life - such as job security, adequate worker wages and the public's agony in making ends meet on meagre earnings - may have added to the debate's relevance and pungence and its close bearing on "the matters of the stomach."

On the face of it, the Inland Revenue Department's seeming inability to spread the tax net not only far and wide enough but also over some of those sections which command financial clout of the first magnitude, is both morally outrageous and flagrantly violative of the principles of social justice. More and more eyes of those labelled as the silent majority would have looked askance at the authorities in the light of the well-known fact that it is the common people who fatten the country's Exchequer through the indirect taxes that they usually ungrumblingly part with.

While some of the prevalent assumptions about the Inland Revenue Department may be wrong, it is up to the latter to clean-up its act and to wield its net with the required degree of fairness.

As pointed out by an opposition Member of Parliament, it is quite possible that the Inland Revenue Department has immense difficulties coping with its workload. If so, the necessary internal reforms need to be launched to rectify these deficiencies. More Tax Officers should be recruited and trained to handle the increasing heaps of tax files. This wouldn't prove difficult in a country which is burdened with a graduate unemployment problem.

All this may need to be done with an acute sense of urgency in view of the fact that Rs. 20,000 million would mean a lot to a cash-strapped economy such as ours. In fact we are glad that no less a person than Premier Wickremesinghe has drawn the attention of the authorities to the need to treat this problem as a top priority.

Spreading labour unrest too emphasizes the importance of speedy remedial measures. The increasing rumblings and grumblings even among the so-called white collar workers and professionals, bring into focus the continuing relevance and sensitivity of the cost of living issue.

Today, we have arrived at a situation where even Government assurances of job security - a case in point being the current round of unrest in the Railway sector - are being disregarded by some politically-motivated trade unions. The essential backdrop to this inflexibility is the Cost of Living burden which constantly fuels politically-inspired trade union action.

Accordingly, the Cost of Living issue will need to be addressed squarely by the Government if social stability is to be ensured. In the face of all this, the authorities couldn't be seen as favouring the rich and powerful by allowing them to elude the tax net.

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