When silence is golden

When silence is golden
By Kofi Akordor
Very few will dispute the fact that whatever comes out from the mouth in the form of words is not easy to retrieve. That was why the wise counsel that sometimes it is better to remain silent. This time, remaining silent is not a cautious step to avoid saying the wrong words; it is purely an economic decision necessitated by the Finance Minister, Mr Kwadwo Baah-Wiredu’s budget statement for next year in which he stated that those who liked talking more on their mobile phones would pay more to the government in the form of talking levies.
Governments everywhere have several ways of raising revenue through taxes, whether direct or indirect. Those on salaries will tell you that they pay monthly income tax on their salaries. The indirect taxes include those that consumers pay on goods and services. So if the government tells the world that it is going to raise tax on importers, what it means indirectly is that consumers are going to pay more. This is because every astute entrepreneur, after calculating his/her expenditure, which includes taxes, will fix prices on his/her goods and services taking into account all the components of the expenditure.
I am yet to see a businessman/woman who would want to make losses or reduce profits. So, naturally, the tax element is passed on to the consumer. What the Finance Minister is saying, therefore, is that apart from the taxes that the telecommunication service providers have passed on to service users, the government is going to adopt another strategy to collect more taxes from consumers.
I am not as worried about the government’s decision to raise more revenue for national development as I am about the reasons given to tax those who use mobile phones. The government, according to Mr Baah-Wiredu, is claiming that most mobile phone dealers evade tax by smuggling their merchandise into the country and, as a remedy for that, innocent consumers who are already paying taxes for using their mobile phones should pay for the negligence, inefficiency and corrupt practices of those who have been paid to make sure that uncustomed goods do not enter the country.
We already know what is happening to the Value Added Tax (VAT) Service, which is owed billions of cedis by business entities, and whether this additional tax on cellular phone users is not another way of making telecommunication service providers richer by sitting on the proposed tax deductions is another matter.
What about those who bought their phones from accredited agents who duly paid their import duties to the state? Should they also suffer as those who are using smuggled phones? Since the talking tax is premised on the fact that mobile phones are smuggled into the country wholesale, is the government going to abolish import tax on phones altogether so that we suffer the penalty by the payment of talking taxes?
A better excuse should, therefore, have been given, and, who knows, that could even have won support for the government from the general public. Many years ago, anytime the government wanted to increase the price of petroleum products, the excuse was that smugglers were sending the products to neighbouring countries where they were more expensive. In short, because of the activities of a few unscrupulous people, the whole nation had to suffer. Even in those days, some of us were not deceived. We knew a few gallons of kerosene carried across the border to Togo, Burkina Faso or Cote d’Ivoire could not warrant the Ghanaian taxpayer paying more for that commodity.
Today, we are using the same smuggling as an excuse to demand more from mobile phone users when the objective in several places is to make the use of mobile phones and the Internet as cheap and accessible to as many members of the population as possible. I am beginning to wonder what will happen if this kind of thinking is carried to its logical conclusion, as we commonly say here. This is because of the simple reason that every commodity, from toothpick from Vietnam, rice from Thailand, tomato from Burkina Faso, onions from Niger to vehicles from Canada, are smuggled into the country, most often with the connivance of those men and women who are paid from the sweat of the taxpayer to protect our borders.
Are car owners going to pay special taxes because importers of second-hand vehicles fail to pay the appropriate duties and taxes on them? According to the Justice Samuel Glenn Baddoo Committee which investigated the Customs, Excise and Preventive Service (CEPS), there are over 13,000 vehicles currently in the system which were not appropriately registered. Could these vehicles also have been hidden in passengers’ luggage or obscure corners of vehicles, as is the case with mobile phones? That means many bad things happen from the ports and other entry points to the vehicle registration and licensing centres and the officers responsible for these places cannot claim innocence. The solution, therefore, does not lie in adding more tax to the poor consumer but ensure better policing on the borders and punishing the smugglers and those who aid them to commit the crime.
Apart from VAT, there are many taxes that are in arrears or could not even be accounted for because the collecting agencies have failed in their duty, are unable to enforce the rules to the letter or cannot properly target those who should pay taxes.
There are many companies and individuals that are making billions in profits but who are not known to the Internal Revenue Service (IRS). The tax burden is, therefore, on public servants and a few companies. Why should the VAT Service and the IRS wait for companies to accumulate arrears running into billions of cedis before initiating action to retrieve what is duly owed the state?
In the Daily Graphic of Wednesday, November 28, 2007 is the story about the frustrations of the IRS to retrieve US$16.7 million owed it by the Ghana Civil Aviation Authority (GCAA) in unpaid taxes as of the end of last year. We can imagine how heavy the national kitty would be if the revenue collection agencies were performing their statutory functions to the optimum with dedication, commitment and maximum efficiency, devoid of corrupt tendencies.
So why should the state add to the tax burden of the populace when serious efforts are not made to collect existing ones? Or is it that those who want to discharge their civil obligations to the state should continue to suffer as a result, while the recalcitrant ones are allowed to escape with impunity?
When cellular phones were first introduced into the country, they were the preserve of a few rich ones. They were seen as status symbols which were displayed with pride at public functions. Today, cellular phones are everywhere. It is one area where the difference between the rich and the poor is not visibly clear. Go to the markets, the chop bars, the fitting shops, the schools, on the streets and in the dark alleys and corners of the towns and villages and you will find mobile phones everywhere.
Mobile phones have brought Ghanaians closer than before. They have actually given expression to the globalisation concept to even the ordinary person. They have removed the drudgery of travelling to one’s home town every weekend for the simplest of assignments when a simple call from a mobile-to-mobile set-up will do the trick.
In the case of a mechanical fault, it is convenient for a vehicle owner to send an SOS message to his mechanic and the problem is solved. If you are stranded or in some dire need for help, you just need to call a friend or a relative, and if you are lucky, help will come. If there is armed robbery in your area, the cellular phone will help to inform the police or other neighbours and a big catastrophe may be averted.
The benefits of the cellular phone are too many and too essential to mention and there is the temptation for the government to try to exploit this. But that should not be the case.
It will be futile propagating the gospel of Information and Communications Technology (ICT) development if the use of the cellular phone, which is an integral part of ICT, is made to become a burden on the ordinary person.
By all means the state must exploit all avenues to raise money for national development, but in doing so care must be taken not to break the necks of the citizenry. We must begin by blocking all the leakage, removing all the bottlenecks, roping in those who have so far succeeded in evading tax and sweeping the corrupt elements from the system.
The revenue collecting agencies should be up and doing and move fast against tax dodgers, while effective mechanisms are put in place to check those who sell uncustomed goods on the market.
For now, it is better we keep on talking and it is the responsibility of the government to ensure that service providers offer more efficient and cheaper services to customers than they are doing now and not to add to their woes. Our elders have a saying which loosely translates that not everything is eaten before the famine season is over. In other words, even at the peak of hunger, there is still the need to avoid eating certain things. We need funds all right, but that should not send us into desperation in such a manner that we begin to tax our very survival.
At least, in this matter of using cellular phones, silence is not the best option.