Budget : A Second Thought
Who Has The Last Word On Taxation?
Abu Hena :
No taxation without representation was the idea, supposedly from Magna Carta, that taking money in taxation is theft unless it is done with the people's consent, through their representatives. The idea raised the perennial question: 'Who was to have the last word in matters of taxation?' In England, the birthplace of Magna Carta, everyone had accepted the doctrine that 'the King may not rule his People by other laws than what they assent unto, and, therefore, he may set upon them no imposition, i.e. tax, without their assent'.
The subsequent conflict centered on the nature of the royal prerogative and the powers of an act of Parliament. The modern view had not emerged then that an act of Parliament was supreme and unalterable unless replaced or amended and that the sovereign power of the state could be exercised in no other way. Indeed, in those days nothing else but financial necessity could compel the king to call a Parliament. If money could be raised elsewhere he might govern for years without any parliament. Moreover, certain undefined prerogative powers the king assuredly had if the exigencies of government required it. If the king chose on grounds of public interest, to make an ordinance, dispensing with the statute, who could say he was acting illegally?
Unlike in England, where there is no written Constitution, in Bangladesh the main principles of our parliamentary institutions and our government have been clearly set forth in a single written Constitution. The fundamental principles of the Constitution have been engraved in the hearts of the consent of the representatives of the nation. No legislative act could be passed, no tax imposed, money spent, that no man could be imprisoned, even for a day, by the arbitrary will of the sovereign, that no power could plead as justification for violating the right of the humblest citizens, have been held by all to be fundamental laws.
The Supreme Court has the overriding power and authority to declare an act of Parliament invalid if it conflicts with the fundamental principles of the Constitution. Moreover, there are other defined provisions in the Constitution giving the prerogative power to the President to declare emergency if the exigencies of government required it. The Constitution also gives the President the powers to make an ordinance dispensing with the statutes on grounds of public interest, when the Parliament is not in session.
It was the public interest and exigencies of government which required, several times in the past, that the annual budget to be passed by ordinance dispensing with acts of Parliament. The real seat of power, even in the parliamentary system, resided in the Cabinet which was constituted of some thirty-five ministers. It is the Cabinet which dictated legislation and even the cabinet's role was grossly eroded and overridden by the dominant prime Ministers who made extensive use of outside power brokers, advisers and retainers. With local government glaringly absent, there remained thousands of civil servants and millions of workers in the public sector. The disorder and anarchy which is the outcome of the system has left the people in a state of total exhaustion and weariness with a visible yearning for a peaceful life at any cost.
Hot topic in Bangladesh, at this time, is the budget. Without an elected Parliament through a fair election none would think that the "government" has no locus stands to place the budget 2019-20 in the House of the People and pass it on people's behalf.
The most important cause of friction between the American colonies and the mother country was Britain's introduction of new types of taxation in order to make the colonies share the costs of the debt left over from the seven years' war. The economic impact of the various new taxes, duties and regulations was bad enough in itself. The taxes and the laws to enforce them caused outrage and to oppose it the Americans found no logical alternative to revolution.
This year's budget in Bangladesh will bring up the same old question as to who will bear the cost of the debt left by successive corrupt governments of the past. People at large believe, not without reason, that the Bangladesh Secretariat, the Prime Minister's Office and its ancillary political offices outside were filled with corrupt people. That an astronomical amount of Tk. 3,20,469 in the budgetary allocation will be spent for corrupt members of the Cabinet and powerful political fixers who are generalist bureaucrats. A large amount of the tax money was squandered by buffoons, courtiers and courtesans of the rulers who filled the ballot boxes before the voting started on 30 December, 2018.
Our hearts are filled with indignation and bitter resentment when we remember having watched the profusion with which wealth was lavished on the political "retainers" and "favourites" who surround the Chief Executive of the government. The corrupt Ministers were exposed many times in the Parliament, parliamentary party forums and in the print and electronic media. On April 15, 2006, an Express Press release authored by Dr Peter Snowman was published with the caption 'corrupt millionaire i ministers in Bangladesh'. In the press release names of 25 Ministers of government came up as worst corrupts who minted money like wild gambling. The press release claimed that at least a billion dollar was squandered away by 25 ministers. After the declaration of emergency on January 11, astonishing facts about corruption and extortion have come out creating public expectations that the corrupt will be punished and public money will be recovered.
Immediately after assumption of office in 2001, Khaleda Zia's government brought out a white paper giving graphic description of the channels and areas through which corrupt practices were perpetrated by the government functionaries of Sheikh Hasina. The Prime Minister's Press Secretary, Harris Choudhury, held a grand press conference to publicise the white paper which painted Sheikh Hasina's government as the most corrupt.
The allegations and counter-allegations of the Awami League and the BNP-Jamaat government were never followed through in order to punish the evildoers and to restore the financial health of the government treasury. The inaction gave the distinct impression in public mind that those were mere eyewash to dupe the people.
The knavery and hypocrisy and immoralities connected with it have been exposed to public ridicule. The rogues and bloodsuckers that were out to exploit the coercive power of the state and manipulate public affairs for private gains were temporarily either behind the bars or absconding escaping arrest and trial. But the heads of the past governments under whose patronage all the nefarious activities took place never accepted their own individual and collective responsibilities. To satisfy their insatiable lust for money, vast were borrowed from banks, savings certificates and public issue of bonds. The ever-swelling public debt never scared or frightened them. As a result our public debt have loaded us with perpetual profusion and servitude and subjected the common masses to heavy taxes, mainly indirect. To balance the books all our future generations will suffer immeasurably.
Over the years, the people have been constantly pounded by the ever-soaring prices of essentials. But economic hardships aside, it was not the commodity prices that stung so much as being taxed at random to compensate for the plundering of the state treasury by licentious delinquents. Nobody enjoys paying taxes, but most people are willing to pay their share of the cost of government and infrastructural development, provided the borrowed deficit spending generates a critical leap in growth and revenue earning to wipe off the deficit. It must be kept in mind that government spending can increase our productivity insofar as the spending is on well-chosen public investment.
Financial scandals, rampant corruption and failures in implementation of development projects highlight the incompetence and colossal mess that the republic has beer helplessly enduring. For proper implementation of the budget, the reform of political system must aim at establishing full authority of the local government as the basis of the self-government system at the grassroots. It is urgently necessary to acknowledge the legislative, managerial and supervisory function of the elected local bodies and transfer decision-making powers to them. The management of local affairs must also be reorganised along the lines of self-government, self-financing and self-sufficiency dovetailing regional interests with those of the whole country. The local bodies should have stable sources of income based on long term quotas, including revenue received from economic enterprises within the areas. They should acquire and accumulate funds for undertaking economic development, improving living standards, protecting environment and performing other urgent tasks.
One single instance is enough to prove that the budget has been prepared sitting in a fantasy world with utopian ideas. Leaving aside the Expenditure Budget which is a routine accounting exercise, the biggest surprise of all is that the AL government of Sheikh Hasina which retained power through voterless elections has set yet another giant revenue collection target projecting a 44 percent year-on-year growth. The total tax revenue collection registered 7.11 percent growth during the July-March period of FY 2018-19 over the same period of the previous year. It was only in May this year that the AL Cabinet revised the current budget down by 4.3 percent caused by fall in revenue collection by Tk. 51,000 crore. In the budget, revenue collection has been estimated at Tk. 377,810 crore. Of this Tk. 3,25,600 crore is targeted to be collected through the National Board of Revenue. The ADP allocation in the proposed budget is Tk. 2,02,721 crore which is 21.39 percent higher than the revised ADP of Tk. 1,67,000 crore for the current financial year. In the proposed budget non-development expenditure stands at Tk 3,20,469 crore. In the current fiscal it was Tk. 2,51,000 crore. That means government's operating cost has gone up by Tk. 79,000 crore. Next year's budget deficit stands at Tk 1,45,380 crore. Of this Tk 68,016 crore is projected to come from external sources and Tk 777,363 crore will be extracted from bank borrowing (47,364 crore) and Tk 30,000 from saving certificates.
The budget is simply the framework on which to work. It is like a stone from which the statue has to be carved out. Only good workmanship can do this job. With the declaration of the budget, a responsible, efficient, prudent and performing government must be in place to take the economy to the high level of equilibrium, which is our aim.
( Abu Hena, a former Member of the Parliament)