by Alagi Yorro Jallow
MAMUDU: The Gambia’s tax policy, tax evasion, and tax avoidance, usually an under-discussed subject, has become a heated issue in the Gambia on social media and that of the traditional media as well as in Diaspora partisan and ideological echo-chambers with politicians and technocrats not offering proposals to redress some long-standing unfairness in the tax code. Our current political leadership class offers a particularly egregious example of what the rich can get away with tax evasion.
The righteous indignation of tax evaders and fraudsters is genuinely marvelous. Instead of walking with their heads bowed in shame because of the heavy burden of financial malfeasance, they want to pose as scrupulous paragons of gravitas and virtue capable of dispensing wisdom and insightful appreciation of matters moral thinking that Gambians are fools.
Mamudu: In fact, it has been said that hypocrisy is not a way of getting back to the moral high ground. Pretending you are moral, saying you are moral is not the same as acting morally. The whole country knows which group borrowed 2 billion Dalasi and has failed to pay back by using all manner of technicalities, including the senior members of the bar. Gambians also know who owes the Gambia Revenue Authority (GRA) billions of Dalasi through tax malpractices.
Mamudu: This reprobate conduct is a notorious and common cause. It does not only require condemnation but punishment. If anything, what is most amazing is the absolute absence of contrition in the face of these fatal cases of financial malfeasance. Instead of walking around with bowed heads in shame, they would rather wax moral and dare to prescribe virtuous counsel on national matters. They point fingers and present themselves as injured victims.
Tax evasion is theft. It is stealing from the public. Those who perpetrate it are criminals. It is the duty and responsibility of every citizen and corporate body to cooperate and work with the Gambia Revenue Authority in order to ensure compliance. Ultimately paying taxes is an ethical and moral responsibility. Every individual with a heart, conscience, and moral rectitude must realize that it is an ethical responsibility to act for the greater good of society, paying taxes as and when they are due.
Mamudu: The 2012 report of the Commission of Inquiry into tax Evasion and other Corrupt Practices has revealed that the government lost over D2 billion from 50 selected taxpayers re-assessed on Income, Sales, and Payee tax and D3, 838, 106. 80 bututs for capital gains tax of 14 transactions of sales of leasehold properties.
The report also exposed a severe flaw in the assessment process and procedures adopted by GRA, which is depriving the government of a large amount of much-needed revenue. It further exposed a significant anomaly in the taxation methodology and negligence by GRA in tax administration.
Mamudu: If there is a tax-evasion problem in the Gambia today, it festers at the top of our income scale, not at the bottom. However, the wealthy and the powerful are outplaying the cop on that beat. Politicians like to brag that not paying taxes makes them “smart.” Gambians should not let wealthy people think that they can outsmart our government and get away with shirking what they owe.
Mamudu: Taxes are not a punishment. They are a duty and a universal call for the ability to contribute towards the environment in which they operate. It should not take the tax authorities to enforce punitive measures to force compliance. The very act of willfully failing to pay when due is criminal and in most jurisdictions of the world attracts severe punishment. For example, in 2011, death was the sentence for tax evasion in China. Qiu Xuanming, a Chinese businessman was, executed for tax evasion in 2005. He was accused together with accomplices of evading tax of $2 million. Qiu was among many tax evaders executed in China. His only notoriety was that members of his family discovered that some organs from his body were missing hence making his case exceptional. Otherwise, during his time, seven people in Guangdong Province received the sentence, and many more were expected to receive the ultimate penalty as the campaign against tax evasion swept through the country. This is how serious tax evasion is considered in other parts of the world.
Nowhere else in Africa and the world at large would a person without any integrity be appointed to a senior public office, least of all one involved in the delivery of justice. Any slight doubt of morality would constitute the immediate ground for disqualification from such office. In South Africa, the presidential appointment of a Director of Public Prosecutions was rejected by the court because the candidate did not meet the high moral standard required for the office.
In Kenya, the appointment of a chief executive for an integrity body was equally rejected because the candidate presented by the President had many unresolved financial and personal matters. These unresolved matters, the court ruled, impaired the capacity of the individual from functioning in such a sensitive position.
It is not enough to pontificate as a paragon a virtue while stealing from the very people one pontificate to.
Mamudu: The balance between the economy and the ecosystem will only be maintained by the responsible conduct of all the actors who should contribute their fair dues. It is not the small people who engage in tax evasion and tax avoidance, and it is the greedy and heartless who are so engrossed in their rapine desire to accumulate that they forget their obligation to the rest of society. The saddest part is that tax evasion is committed by people who know how to manipulate books to ensure that they mislead and confuse. If anything, evasion has been so refined that accountants are specifically employed to ensure that books are doctored to cheat the taxman.
There are plenty of other ways the politicians, the powerful, and the wealthy have wriggled out of tax obligations. Some may be legal, and some are likely not, but all are troubling examples of the ways the rich and the powerful can avoid paying their fair share. In the previous regime, they used a complicated maneuver to virtually disappear hundreds of millions of Dalasis on which they would have owed taxes—a move so legally dubious their lawyers advised him that the Gambia Revenue Authority( GRA) would most likely declare it improper if they were audited. They have aggressively fought to reduce what they owe to state and local governments by arguing that the on-paper value of their income should be lowered, even claiming to tax authorities that their income was worth less than the value they assigned them in other legal documents.
Mamudu: It is impossible, of course, to say whether they have illegally shirked their tax obligations and, if they have, by how much and for how long. Nevertheless, the GRA has become toothless when it comes to cracking down on tax evasion among the wealthy. That is not to say that the GRA is sitting on its hands, in any case. As it has gone easier on the rich, the agency has kept its sights trained on the poor.
Technically tax evasion has been called “the illegal evasion of taxes by individuals, corporations, and trusts. Tax evasion often entails taxpayers deliberately misrepresenting the actual state of their affairs to the tax authorities to reduce their tax liability and includes dishonest tax reporting, such as declaring less income, profits, or gains than the amounts earned, or overstating deductions. One measure of the extent of tax evasion (the “tax gap”) is the amount of unreported income, which is the difference between the amount of income that should be reported to the tax authorities and the actual amount reported.
In contrast, tax avoidance is “the legal use of tax laws to reduce one’s tax burden. Both tax evasion and avoidance can be viewed as forms of tax noncompliance as they describe a range of activities that intend to subvert a state’s tax system, although such classification of tax avoidance is not indisputable, given that avoidance is lawful, within self-creating systems.”
Mamudu: Tax evasion or, indeed, tax avoidance is theft. It is stealing from ordinary Gambians. Similarly, failing to pay back money borrowed from public institutions is a crime against the people of the Gambia who need the money for public service. It will not do to apportion blame. Retribution follows those who abuse trust. This may take longer, but surely it is bound to come.
by Alagi Yorro Jallow