It appears that the State’s fiscal back-room mandarins have not been burning the midnight oil as much as they did around this time last year. Oh, sure they have all been doing the usual computing and totting up the checks and balances before the government opens up the nation’s accounts for everyone to see. You may have guessed by now what it’s all about. The days are getting shorter as the fiscal winds will soon be blowing in the National Budget 2017 to be tabled in Parliament on November 10.
Without a doubt, the Central Bank bond matter has taken precedence over the National Budget and most other national issues. In fact, it has become the burning issue of the day, many perceive as snowballing into serious political repercussions for the nation. Predictably, the Budget reading per se will not cause any real financial grief to the citizens of this nation. That is because many of the economic burdens have already been inflicted on the people with pre-Budget hikes of certain essential commodities and ‘sin-taxes.’
With every Budget, and non-Budget, the increase in the prices of such commodities by gazette notification has simply become a case of expecting the expected. In Sri Lanka, taxes on citizens can be raised without consultation outside the annual Budget through a so-called ‘midnight gazette,’ literally concocted while citizens are sleeping.Taxes for too long now have been imposed on even certain basic necessities such as essential foods outside the Budget, a practice which became widespread of late, worsening the uncertain lives of the citizens. And it goes on regardless despite that fact that such a gambit is a fundamental violation of the principle of ‘taxation by consent’ practiced by free countries.Taxation or better still tyranny by midnight gazette has to be abolished as soon as possible, if we are to become a free people.
This draconian fiscal policy is usually implemented ahead of the reading. As usual, the price hikes will remain craftily concealed during the actual presentation.That has been a certainty given the predilection of all finance ministers to resort to an ‘easy come’ source of revenue, forcing smokers and tipplers to resort to the more hazardous ‘beedi’ and the illegal and dangerous gut-rotting moonshine, ‘kasippu.’ Basically, many view sin taxes as more sinned than sinning.
Now, if I had a suspicious mind, which fortunately for the political fraternity I don’t, I may have surmised that some of our lawmakers profit quite handsomely from the illegal hooch trade. If only they are made aware of the damning derisory toasts raised in their dishonour by irate tipplers. Smokes and safe hooch are beyond the affordability of most citizens.
Levies on items are routinely hatched in secret by bureaucrats and ministers and slapped by midnight gazette to help special interests lobbies, literally, while the citizenry is sleeping in a brazen act of prerogative taxation without parliamentary or even cabinet sanction.Parliament then rubber-stamps the levies later in a grotesque parody of the basic democratic principle of ‘taxation by consent’.
However, all these duplicitous measures will have a direct bearing on the cost of living and, in turn, the quality of life and health for ordinary Sri Lankans. The common man is more preoccupied with the unbearable increases in the prices of food, fuel, travel and other essentials while faced with the daunting prospect of day-to-day survival.This year, some groups had challenged the practice of imposing VAT by minister’s prerogative in the Supreme Court, and the current administration was forced to backtrack and treat people in a less autocratic manner.
But they bided their time and pushed ahead with the obscene VAT, adding more woes to the hapless populace. Even those who seemed relatively comfortable a while back are now splashing around frantically to keep their heads above the inflationary waterline. People who not long ago purchased essential items by the kilo are now constrained to penny-pinch and buy by the gram.
It is also true that our economy has been crippled by corruption, politicization, nepotism and a bloated bureaucracy. These are also the gloomiest times for the consumer made even darker by the people’s disillusionment of successive governments that have failed miserably to live up to expectations while reneging on grandiose promises.
At any rate, that has been the rule rather than the exception, because the politicians impose austerity on the many while lining their own pockets and those of their fat-cat cohorts in an often monopolistic market.For instance, how can anyone justify the country’s depleted coffers being emptied to pay off credit lines for personal duty-free vehicles for all those ‘honourable’ MPs? Remember, there are 225 of them in all, and every one of them campaigning on a platform of budgetary caution and austerity. Of late, they have been spending too much time in attempting to convince the people to swallow bitter economic medicine, without even sugaring the pill.
Eventually, the country will have to confront the deficit we have, rather than the shortfall we imagine. The one we have is a deficit caused by waste, fraud, abuse and vague out-of-control spending. And the colossal costs incurred for the upkeep of the gargantuan Cabinet will certainly not help in the cause of bridging the deficit.
Neither of our big party governments has had a coherent vision for poverty eradication. Priority concerns such as basic social services, welfare, education, housing and health care have been left unaddressed. But all governments say they are optimistic of better times ahead. The only way to be optimistic about our nation’s economic future at this stage is to look at the charts upside down.
Everything at this point calls for harsh budgetary measures in an effort to bridge the colossal Budget deficit, generate more revenue, curb expenditure and honour both staggering domestic and foreign borrowings.
There has to be enormous cost-cutting in public spending and a complete clean up and overhaul of the totally mismanaged state sector enterprises which are labouring under a mountain of bad debt. Slashing government spending and ending the incalculable waste will help decrease criminally profligate state expenditure to a remarkable degree.
If anything, it illustrates the loose financial and other controls that characterize the world of our state enterprises. The government must not be seen to display leniency and indecision in situations that require prompt, tough action and remove the sycophantic corrupt scabs heading them. In short to bridge the budgetary gap they should short shrift the scab and slash the flab.