Muzzling the press

On 8 August 1974, Richard Nixon was forced to submit his resignation as President of the most powerful nation on earth, militarily as well as economically: the USA. No power on earth could save him from humiliation. It was the unraveling of the greatest political scandal in modern times, known as ?Watergate?, brought to the notice of the public by the courageous investigative journalism of two reporters from the Washington Post.

This event not only vindicated the strength of press freedom but also the value and the power of what Edmund Burke called the Fourth Estate, more powerful than the other three: the Legislative, the Executive and the Judiciary. The French would call it ?le quatrième pouvoir? or ?le contre-pouvoir?. No wonder the power wielded by the press is not to the liking of governments and people who would like to enjoy absolute power and indulge in corruption.

Freedom of speech, which is fundamental not only in a democracy but also to the concept of human rights, has, over the ages, become the most powerful tool in promoting social justice in general and in the upliftment of the downtrodden classes of society in particular, and in uncovering cases of corruption and abuse of authority.

Powerful voices were raised in Mauritius prior to independence to make Mauritians aware of their rights and to fight for their dignity ? among them Emmanuel Anquetil, Dr Curé, Basdeo and Sookdeo Bissoondoyal, Sir Seewoosagur Ramgoolam and Guy Rozemont. In parallel Dr Millien?s newspaper ?l?Oeuvre? was at the forefront of the battle for human rights, including freedom of the press, in the same way that ?le Mauricien? under Andre Masson was later ostracized for fighting the same battle. Nearer to our time we have Jean Claude de l?Estrac, Bikramsingh Ramlallah and others jailed for opposing a proposed press censorship.

The independence of Mauritius was not won, as Jawaharlal Nehru said in the case of India, by ?putting proposals on a platter and dancing attendance on the British Government for acceptance?. In India the tradition of a free press is so anchored in its way of life that the Executive dare not touch it. Only last week the Indian Government had to climb down in its attempt to amend the ?Right To Information? Act to make it impossible for the public to obtain certain information. It is not only the decision arrived at that is important, but also the decision making process, including notes and recommendations made on file. The Government wanted to keep these out of the inquisitive eyes of the public. The press and the trade unions stood up against this attempt, and an old freedom fighter, Anna Hazare, went on a hunger strike two weeks ago. Eleven days after the beginning of the fast the Government gave in and decided not to amend the RTI Act before comprehensive discussions take place with the activists. But the fight goes on.

It is sad to see politicians wax eloquent on soap boxes as champions of human rights and ditch them when they are in power. Laws already exist in a civilised society to deal with slander, obscenity and national security. There need not be special laws targeting the press. There should, on the other hand, be regulations in order not to deny certain sections of the press which oppose government policies the same facilities, particularly regarding paid advertisement, that others benefit from.

We are not in the 18th century which saw Voltaire sent to prison for being satirical about the French government, and exiled when he refused to be gagged. Two centuries later it was the turn of the British television to launch the most successful weekly satirical show targeting everybody in a high position, but particularly the Establishment. Even the Queen was not spared. Do we need a new Voltaire to tell us; ? I may not agree with what you say, but I will fight to the death for your right to say it !?

Surendra BISSOONDOYAL

A case for the flat tax

I refer to the Raj Meetarbhan?s editorial ?Mythes et réalités ? to which I broadly concur.

I am however surprised at your argument: ?Il est vrai que l?imposition d?un taux unique de 15 % peut paraître injuste car les plus fortunés seront taxés au même taux que les salariés modestes. Il manque à ce régime une progressivité, c?est-à-dire un mécanisme qui impose une pression fiscale plus lourde sur les plus riches?.

At a time when many countries are (successfully) resorting to a single and lower tax rate to attract investments and boost productivity (and reduce tax avoidance / evasion), Mauritius will lose a lot through a progressive income tax system. A progressive income tax system will in fact penalise those who sacrifice their leisure to engage in productive activities.

To illustrate the unfairness of a progressive system of income tax, I would like to show how it could affect A and B, who could be salaried colleagues working together. A?s earnings place him on a level where he has chargeable income of Rs250,000. He ends his work at four, takes life easy, relaxes or just sits idle or stands on the streets talking to friends, if not drinking ? that?s his choice ? or even inconveniencing people passing by. A uses his disposable income to buy a car and keeps on complaining that the roads should constantly be improved by the government from funds raised by taxing ?others?. A?s wife spends the day watching TV serials. A therefore pays annual tax of Rs37,500 with his taxable income of Rs250,000.- being charged at 15%.

B is in the same situation as A except that, instead of buying a car, he travels by bus and prefers to use his disposable income to erect a restaurant. After finishing his work, he sacrifices his leisure and runs his restaurant with the help of his wife, works till late night and during week-ends and raises additional income of Rs1,000,000.- annually through his restaurant. B?s wife spends her day going to the market to buy vegetables for the restaurant, cleans the restaurant and the utensils, prepares the ingredients for use in the restaurant and then spends her evenings and weekends assisting her husband in the restaurant.

Now, if we adopt a progressive system of income tax (say with a 15% and a 25% band), B would be paying tax as follows:

? First chargeable income of Rs 250,000 from his salaries on the 15% band (just like A); plus

? Next chargeable amount of Rs 250,000 (out of the additional Rs 1,000,000 from the restaurant) on the 15% band (since Rs 500,000 is taxable on the 15% band); plus

? the remaining Rs750,000 of the income from the restaurant on the 25% band i.e. B would be paying total tax of Rs 37,500 + Rs 37,500 + Rs187,500 i.e. a total of Rs 262,500 (compared to A?s tax of Rs 37,500).

Based on his total chargeable income of Rs 1,250,000, B pays an effective tax rate of 21% (compared to A paying 15%). Is this really equitable, fiscally more responsible and the way to reward entrepreneurship and sacrifice? Let?s not forget the fact that B would also have created employment for a few.

Based on the above, I think we should not try to portray a progressive system of tax as fair and equitable.

One point though: in Mauritius, for obscure reasons, wealth has traditionally been passed on from one generation to another without any real taxation (and in many cases these are ?passive? assets). If you are advocating a tax in these circumstances to tax the ?riches?, you are absolutely right, we effectively lack ?un mécanisme qui impose une pression fiscale plus lourde sur les plus riches?. The lacking mechanism is however not a progressive income tax rate or other forms of tax on people who engage in productive activities but rather a proper inheritance tax on assets transmitted from one generation to another and which should be more or less similar to the IHT in many OECD countries.

Rohit Ramnawaz (Managing Director, Schindlers Trust Mauritius Limited)