Respect our two neurones, please!
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Respect our two neurones, please!
“Look guys, this is what I am proposing in this budget: I will introduce a new substantial tax on all those who are working in the private sector. Their employers will be charged an even heavier tax. On the other hand, all civil service employees and their employer – the government – will be exempted from paying this tax. The government will use the money collected from you as it wishes, including dishing out freebies that might help in its re-election. You will naturally get nothing specific in return because it is a tax. What is it about the word ‘tax’ that you don’t understand?”
Had Minister of Finance Padayachy spoken to us in similar terms, we would have commended him for his courage and for respecting our intelligence. Introducing yet another tax at a time when people’s pockets are bleeding dry and taxing their employers too so that government starts being generous with the targeted chunks of the electorate that it wants to attract does indeed require courage and a certain mind-set that we know he has – grabbing money wherever it is (STC, CEB, BoM, FSC…), with absolutely no eye for the consequences. Whether we accept that or not, at least we won’t feel that the compounded lies and misinformation surrounding this whole exercise are insulting our intelligence.
Instead, Padayachy grabbed his magician’s wand, donned his pompous tone and gave the tax the confusing name of Contribution Sociale Généralisée (CSG), borrowing from France, where it is not working well either, and started confounding this with the National Pensions Fund, a fund which we were paying a couple of hundred rupees into every month and where the money was judiciously invested, so private sector workers could get a few thousand rupees more to supplement the Basic Retirement Pension. That fund has been closed down. It has NOT been replaced. The CSG goes into the Consolidated Fund and the government can use it for any purpose it wishes, including buying luxury cars for ministers and footing the bill of their first-class travel around the world, laced with generous per diems. No part of the CSG is actually specifically coming back to us in our old age. Let that sink in!
To make matters worse, Padayachy unleashed some propagandists into nature to turn the knife in and insult even more the two neurones we have left. So, we are told that the tax imposed on part of the population is a fair move that has reduced the gap between the rich and the poor. How, pray tell, is it fair for a private sector employee who works 10 hours a day, to squeeze 3 per cent out of his meagre salary to pay for the lifestyle of the top civil servant who enjoys so many benefits and who most likely goes home at 4 p.m. every day? By what magic exactly does that reduce the income gap? How fair is it for the worker who scrimps and saves to make both ends meet, to be forced to give a Rs20,000 gift to all youngsters on their 18th birthday, when some of them have so much money they wouldn’t know what to do with it? How fair is it for any of us to work so hard to pay for the government largesses in return for votes?
The biggest lie propagandists have also dared utter is that the Consolidated Fund can never go bankrupt. That is probably what the luminaries at the Bank of Mauritius must also be thinking while handing over the bank’s reserves to the government and continuing to empty the Bank’s coffers by indecently offering themselves the latest limousines – luxuries they could never afford if they had to rely solely on their credentials and merit.
It is time magicians of all ilk learnt the humble lesson that housewives instinctively know: you should only spend what you earn. Padayachy’s ‘balanced budget’ which used the future reserves of the central bank by printing money has led to the rupee dropping to its lowest level ever and to inflation soaring. We pay for that every day we wake up even before we go to the supermarket. Now to refill the Consolidated Fund to pay for the promised CSG, the government has only two options: either it borrows (we already have in excess of Rs500 billion public debt, excluding goodly amounts conveniently hidden in Special Purpose Vehicles and the unspoken deficits of virtually all parastatals) or it raises more taxes. Another CSG by another name in view?
A third edition of Touria Prayag’s book “Provisional Charges: The Untold Human Stories” and her second book: “#BLD: When Mauritius Lost its Bedside Manners” are now available at Librairie Le Cygne, Le Printemps and all the Bookcourt outlets.
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