Don’t tax people on low incomes

By Ankit Thapa

Almost everyone knows that the traffic system in the country is highly chaotic. It is not just the system that is problematic; the condition of the roads and the behaviour of both vehicle drivers and pedestrians are often reckless and dangerous, posing risks to everyone on the road.

A few days ago, this author met an important politician and was surprised to hear him complaining about various laws that his own government had introduced. I laughed and asked him why they had created so many regulations when, instead of facilitating public life, they only made things more difficult for ordinary people. I would like to reiterate that laws and regulations alone are not enough to address the problems the nation and its people face. What matters most is the strict and effective implementation of the rules and regulations introduced by the government itself.

One bitter experience I personally faced was having to pay a huge amount in taxes on a vehicle I owned. Of course, we know that Nepal depends heavily on taxes imposed on imported goods, particularly on products that the government considers affordable only to the wealthy.

This raises the question of why such high taxes are imposed on imported vehicles. For example, a vehicle that costs relatively little in neighbouring countries may cost four or even five times as much when purchased in Nepal. The government seems preoccupied with increasing domestic revenue through taxation, often without considering the direct impact on the lives of ordinary people.

Instead of relying solely on higher taxes, the government and policymakers should focus on making Nepal self-sufficient by promoting domestic industries and creating employment opportunities for Nepali citizens. The heavy taxes collected from the public should not be misused to provide luxuries and comforts for ministers, political leaders, civil servants, security personnel and others. Such misuse of public money is unacceptable. Those responsible for it should be the first to face punishment.

As mentioned earlier, the government has focused on collecting more taxes across almost every sector while failing to provide adequate facilities or concessions to ordinary citizens. This is certainly not the way to improve the national economy.

More taxes are imposed on imported goods, while little effort is made to develop domestic industries. Consequently, the government struggles to strengthen industries within the country. Increasing taxes may provide some short-term relief to government finances, but it cannot strengthen the economy in the long run. We need only look at how heavily Nepal’s economy depends on remittances to understand the consequences of this approach.

Taxing imports is not inherently wrong, but imposing excessive taxes on domestically produced goods is counterproductive. Priority must be given to encouraging and promoting domestic industries and making their products more competitive with imported goods.

Many people are irritated by the practice of imposing fines for even minor violations, seemingly to increase government revenue. For example, owners of small vehicles may be required to pay hefty fines when their taxes or fees are overdue by just a few days. At the same time, industrialists and businesses owe billions of rupees to government-owned institutions such as the Nepal Electricity Authority (NEA).

What kind of policy have successive governments, including the present one, followed that allows such enormous amounts of money to remain unrecovered? These funds should be in the coffers of the government or the relevant public institutions, including so-called autonomous bodies such as the NEA. If such selective enforcement and failure to recover public dues are not signs of corruption and mismanagement, what are they?

Political leaders and civil servants have long been accused of accepting bribes and allowing powerful industrialists and businesspeople to go scot-free, even when they are involved in serious financial crimes that harm the national economy.

Meanwhile, government agencies, including the police, often appear more interested in arresting or taking action against petty offenders accused of minor violations, such as drinking or gambling, than in pursuing major financial offenders. What about those who plunder the nation’s resources? Should they not also be prosecuted?

Authorities, including security personnel, seem to turn a blind eye to serious offences allegedly committed by the privileged and powerful. Why is this so? The scale of corruption involving political leaders, civil servants and security personnel is a matter of grave concern. As already noted, corruption is one of the root causes of the many problems facing the country.

The widespread indiscipline and lack of civic sense that we are witnessing across various sectors indicate how far the country has deteriorated. Unless we reform the system and change the attitudes of the people, no matter who comes to power, little will change. Meaningful progress requires not only better laws and fair taxation but also accountability, discipline and equal enforcement of the law for everyone.

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