Tax must be audited to penalize fraudsters in court
By Kiden Stela Mandela
The obligation to pay tax to the government is the moral responsibility of the citizens in any nation on earth. The citizens do so while in return they expect services delivery from the government. The government agency tasked to collect tax from the citizens, institutions, foreign nationals and entities, does so within the defined mandates, mechanisms, and tools deployed to get insurance against fraud, tax evasion, and tax system collection abuses by either the tax collectors, or tax payers. The moment the initial design of tax system collection has flaws the government expects less in terms of revenues generation into public coffer. And if the same government abuses its tax system, the end result is maladministration and less development.
Last week one of the top government officials admitted tax fraud within the system that hindered services delivery to the citizens.
“You are part of the problem or at times we are all part of the problem. There are issues of malpractices, misuse of public funds. You collect it right, bring it, I will distribute it right but if you don’t I will have nothing to deliver to the people”, the Minister of Finance and Planning, Agak Achuil Lual was quoted as saying by the media.
The Minister’s admission of tax fraud points to the flaws within the taxation system designed parameters which were initially ignored by the policymakers or the architects. Managing and administering tax system is not easy tasks, tax collectors and taxpayers if they are not closely being scrutinized; very little revenues would trickle into the public treasury.
Further, there is mismatch within the taxation system; the instruments and institutions assigned or designed for the tax collection. There is lack of clear distinction and standard operation boundaries. The National Revenue Authority (NRA) is the institution designed for tax collection in the country. However, there is also government institution like Juba City Council which levies also heavy tax under different jurisdiction direct into Mayor’s Office and yet it is the same government.
We understand the system of governance is divided into two; there is national level, and state level. So NRA system and tools appeared to be running parallel from that of City Council which has created centrality complexities of tax collection administration system. The NRA instruments and tools should have been designed and deployed at every different level of tax collection points. And the state governments are supposed to be given percentage quotas in NRA revenue collection through reimbursement into the state coffers, while the other percentage should go to the national treasury.
“We need to harmonize taxes. The more we collect taxes, the security takes, City Council takes and the traders will add the taxes on the goods”, Minister of Finance Agak lamented.
The statement ideally tells that revenues collection go into different directions not centralized system of tax administration. And there are excessive tax collections that are out of bound. This has left opportunities for fraudsters and tax evasions heaven. The environment for investment is not conducive enough, the business people are always being haunted with excessive levies, and they transfer them on the ordinary citizens in pricing of goods, and services. The government employees are not paid because of no money in the public treasury.
This means that a lot needed to be done by the government to define well taxation collection system. In contemporary society, always the institution designed for tax collection is one only with clear areas of operations and powers to audit tax returns. Those that abuse tax system are caught through auditing, and they must be prosecuted.