Thursday, March 12, 2009

VDIS: Guilty have the upper hand!

I got a lot of angry comments (okay, I got good ones as well) when I wrote this opinion piece defending the government of Nepal’s decision to implement Voluntary Disclosure of Income Scheme (VDIS), which was designed to give an opportunity to tax evaders to reveal sources of their assets and income and pay 10% of it to clear outstanding tax payments before they face the regulatory music. I had hoped that the government would enforce this provision to the fullest. Sadly, the government is bowing down to the illegitimate demands of business executives, who are the principle tax evaders.

It is ironic that the government has yielded to demands of tax evaders, who are in a way guilty of committing a crime, i.e. conceal true worth of assets and income and not pay taxes to the government. The government has spared application of VDIS in investments made in labor-intensive industries like hydropower, physical infrastructure, and “other productive services” (uff, another loophole!).

I can’t understand why the FNCCI, the apex representative body of the business sector, is so ferociously arguing against VDIS. Is this an indication that the business executives have amassed more ‘black money’ than is thought? It is a golden opportunity for them to turn ‘black money’ into ‘white money’. They are ignoring this at their own peril!

The Maoists government should live up to its promises and proposed policies. People have already heard too much (and redundant) rhetoric. Time for action! By this, I mean real action, which might often come at the expense of few crooked business executives going down or behind bars! The VDIS is one of the few policies I have been supportive of the Maoists government.

Why let the guilty have an upper hand?