22 October, 2017

The Counter-Robin Hoods

By Tisaranee Gunasekara

“I shop everywhere, anything that fits perfect will be purchased, price and name does not matter”. – Rohitha Rajapaksa (Daily Mirror – 8.5.2013)[i]

In her autobiographical-history of Pre-revolutionary China, Han Suyin explains how the country’s incompetent and spendthrift rulers used taxes as a mode of wealth-extraction from ordinary people. Kettle tax, stocking tax, bedding tax, hog tax, wealthy house tax, army mule tax, troop movement tax, soldier reward tax…the list was endless. “There was inaugurated in certain areas a ‘happy tax’ for the purpose of promoting happiness on the day taxes were paid”[ii].

Mahinda PBJanamoola Nayakaya’ (Leader rooted in the People) is one of the innumerable accolades bestowed by the Rajapaksa-state media on President Rajapaksa. The Rajapaksas use ethno-religious chauvinism to create a sense of identification and commonality between themselves and the Sinhala-Buddhist majority. This rhetoric of solidarity is belied by Rajapaksa economics. As the 2014 Budget reveals, again, a fundament of Rajapaksa economics is taxing the poor and the middle classes (including the Sinhala poor and middle classes) to the benefit of the Ruling Family and its kith and kin.

This week, JVP Parliamentarian Anura Kumara Dissanayake revealed that the government imposes a tax of Rs.25 on a litre of petrol[iii]. This is just one example of the nexus between indirect taxes and cost of living in Sri Lanka. Indirect taxes form the financial mainstay of the government. Prices go up, primarily because of indirect taxes; indirect taxes go up, because the government has no other way – apart from borrowing – to make ends meet.

According to 2014 Budget 87.1% of government income is expected to come from taxes; 67.1% of government income is expected to come from indirect taxes.

2014 Budget reveals not only a government dependent on indirect taxes for its financial survival but also a government which is intent on rewarding its kith and kin at the expense of the masses. This bias is obvious in the way the regime wielded its tax-sword to the detriment of the ‘Common Man’ and the benefit of the ‘Rajapaksa Man’.

Cess taxes were increased, at unspecified rates, on a range of goods including wheat flower, cheese, curd, margarine, sauces, sausages, sweets, chocolates, cereal, pasta, vinegar, vegetables, mushrooms, nuts and fruits, fruit juice, mosquito coils and cut flowers. A 25% tax was imposed on gauze. Import cess taxes on steel products, aluminium bars and tubes, padlocks, hinges and Portland cement in packs of 50kg or below were hiked. A special commodity levy was imposed on sprats, chickpeas, green grams, canned fish, sugar, Maldive fish, dried fish, orange, coriander, cumin, tumeric, ground nuts, mustard seed, palm oil, salt, yoghurt, butter and margarine. A Nation Building Tax of 2% was slapped on banks. A 5% tax increase was imposed on telecom services. VAT exemptions on paddy, rice, wheat, some spices, dessicated-coconut, rubber, latex, coconut, tea including green tea, rice flour, wheat flour, eggs and liquid and powdered milk, tractors, semi-trailers, machinery for tea and rubber industry, plant and machinery for firms, and some pharmaceutical preparations were removed[iv].

2013 budget gave a 300% tax break to super racing cars. That trend of pampering a tiny sliver of the politico-economic upper crust continues in the 2014 Budget. Designer pens, ties and bows have been made Cess-free. Branded consumer items have received a tax relief; they will be taxed at 7.5%, the lowest rate possible.

Indirect taxes, imposed not on luxury goods but consumer essentials, amounts to a form of wealth extraction from ordinary people. When this extraction is not balanced by increased incomes, consumption levels decrease and debt levels go up. This scissors crisis in popular living standards causes a host of secondary problems, such as the exacerbation of under-nourishment. Japan has already warned about precarious nutrition levels of among resettled IDPs, especially children[v]. As Amartya Sen and Jean Drèze point out, “Endemic undernutrition is a less obvious – less ‘loud’ – phenomenon than famine… But even in terms of sheer mortality, many times more people are killed slowly by regular undernourishment and deprivation than by the rarer and more confined occurrence of famine”[vi].

Sri Lanka is in danger of becoming a country characterised by under-developing people. And as Budget 2014 demonstrates, national wellbeing (including Sinhala-Buddhist wellbeing) matters to the Rajapaksas only as an attractive façade and a convenient slogan.

Acolyte Capitalism

Using the example of Latin America, Michael Walton warns India about the dangers of ‘structurally disequalising growth’ caused partially by “implicit social contracts between the state and the business and the state and various social groups”[vii].

This warning is extremely apposite for Sri Lanka, not only because the country is becoming an Asian leader in inequality-increase but also because the growing nexus between the Rajapaksas and a segment of the private sector is becoming a key-determinant of economic and budgetary policies.

According to some analysts, the regime is using taxes to impose protectionism, for the benefit of favourites: “In a continuing disturbing trend, more industries were given protectionism, allowing favoured businessmen to avoid competition, further worsening a culture of rent seeking and exploitation of poorer consumers. Boats and gauze were added to the list while protectionism was increased for building materials and food. Already monopolises have developed in building materials under protective tariffs…”[viii] After a recent spree of acquisitions, the Rajapaksas’ in-house business magnate, Dhammika Perera stated, “We now have a monopoly in ceramic tiles and aluminium industries”[ix]. Mr. Perera is reportedly a ‘big fan’ of President Rajapaksa[x]. Naturally; the Rajapaksas kept him as the BOI Chairman for three years and then made him the permanent secretary to the Ministry of Transport; Rajapaksa economics and Rajapaksa budgets are particularly good for his many businesses.

This is Acolyte Capitalism, a system where success in business depends on how loyal and obedient you are to the Ruler/s.

In October 2013, the Perceived Economic Opportunity Index (PEOI) decreased, “ending up around the lowest level since the index was developed in July 2011… Most people are just managing to meet their household expenses but are worried about rising prices into the future, according to the Index complier.”[xi] This tallies with the findings of the far more scientific opinion poll by the CPA; ordinary people, from South to North, want decreases in living costs and improvements in agriculture, health and education. The Rajapaksa priorities occupy the polar opposites, as Budget 2014 demonstrates.

The rich and the poor, the powerful and the powerless do not inhabit the same world. Sensible policy makers try to lessen this gap, lest a clash of the worlds happen. The inverse is happening in Sri Lanka. Mahinda Rajapaksa’s latest budget proves, again, that the regime, given its nature, cannot but continue on its current economically ruinous and politically destabilising anti-Robin Hood path.

Attacking political critics and opponents, mismanaging national finances, tolerating obscene disparities, further alienating ethno-religious minorities and antagonising powerful regional/international players – these are outward signs of a fatal systemic disease. Patriotic rhetoric and fear mongering are merely interim solutions to the crisis. As the other Rajapaksa-priority – a gargantuan military and a bloated defence budget – indicates, naked force will be the Siblings’ ultimate solution to the burgeoning economic malaise and its socio-political and electoral fallout.


[ii] The Mortal Flower

[vi] Hunger and Public Action

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Latest comments

  • 14
    2

    The picture tells a thousand words.

    MR looks very smart when he puts the glasses on, looks like he’s been working tirelessly for the whole day. Wonder how long the photographer took to arrange the set…

    • 0
      0

      good one :)

      • 3
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        Thanks Thisaranee, another good one! There are those who believe in the Rajapakse dreamland – consume till you perish – Macdonalds, KFC, Burger KIng, TGI Friday – oil and sugar filled diabetes inducing food.. and those who know the reality of increased inequality and corruption in the debacle of Asia..

        The Rajapassa model of development is exacerbating avoidable diseases like diabetes, heart attack, stroke etc. Their model of development is consumerism and inviting third rate multinationals to occupy Gota the Goon’s renovated colonial buildings in Colombo.. Never mind the health and social effects of this sick form of consumerism which Rajaspassa considers “development”. This consumerism in Rajapassa Disney Land is to DISTRACT, DIVIDE and RULE the Sinhalaya Modayas!

    • 14
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      ha! ha!
      For me, He looks like a primary class kid looking at a A-Level maths exam paper. -:)

      • 8
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        Me Even O/L maths not Passed,
        Then how to get A/L Maths paper.
        OH, Dont’ you know, Computer Gilmart?.

        • 2
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          No, No, he is a JPUM (Junior Puked Unable Matriculate). His brains are embedded elsewhere!

      • 6
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        Sumith I give you a like for your sense of humor. But the are better Mathematicians than you and I !!? Didn’t they spend 1400 ( One thousand four hundred) Million per kilo meter, when constructing the ground bounded & noise polluted Katunayake high ways !!?

        • 0
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          That is because they do not know their math

      • 1
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        You are correct. If he can understand this budget, he will change many sections.

    • 2
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      Looking for the price of SHOWGON Galbanis after the Carnival?.
      Why not Soothsayer not with them?.

    • 4
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      …He has been reading tirelessly all day.. and read almost an entire paragraph all on his own.

    • 0
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      Tissaranee Gunesekera, …………………………………….

      “In her autobiographical-history of Pre-revolutionary China, Han Suyin explains how the country’s incompetent and spendthrift rulers used taxes as a mode of wealth-extraction from ordinary people….”

      You forgot the Indulgences Tax of the Catholic Church hat resulted in the Protestant Reformation….. and the Tea Tax of the British on the Americans that resulted in the American Revolution…….. No Taxation without representation……………………………….

      However, the Rajapaksa project Do have representation and taxation, because the representation have been bribed and bought out, even many of the voters……….

      DeJa Vu….

  • 0
    7

    Well T.G., let’s put your doom & gloom budget predictions to the test. Provincial council elections are just around the corner, and if this budget is an anti-people/ anti- Sri lankan budget, then it should reflect electorally. As you know, the proof of the pudding is in it’s eating… I hope your vote will at least make a ripple in the ocean :)

    • 10
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      Jazz, go for the Night Races and enjoy man. Your hunger and worries will vanish. So will the Nation’s. Therefore whether the voters vote is immaterial as the ballots are already marked.

      • 1
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        where do they hold those night races ?
        Do they have areas for that in SL ?

      • 3
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        Gamini, interesting thoughts but, Ranil W. has never stated that elections are rigged.

        However, even if the elections are rigged, it shows the utter incompetence of the opposition since they have not figured out how it’s being done. So, thank you for re-inforcing my point that the bigger problem that confronts this country is that we have an absolutely impotent opposition.

      • 2
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        the ballot papers will be marked while the masses watch the races FREE… why cant the races be held in racing tracks without being a nuisence to the public? Just coz a Ruling “KID” like to have FUN at the expense of the Masses…? Oh btw they will offer free viewing to boost the voter base and the party goes on……even after SHOW GUM…. MUSIC BEING PLAYED WHILE THE DECK IS BURNING… After all… aren’t we a nation of ” Neva Gilunath Baand choon” ? translation… While the ship is sinking, music is being played

    • 0
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      Have you heard of jil mart? Weerawansa got 200 000 votes! How?

  • 10
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    I want more tax hikes and more price increases. The more the better. This will be the only way to wake up the blind patriots from their kiribath induced war victory slumber. :D

  • 6
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    to an extent Percy Jilmart, I agree with you. I have that same angry craving myself. But I shudder to think of what will be the ultimate result when that explosion occurs and we have no law, no courts, no police to keep order. The Wonder of Asia indeed\!

    • 2
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      Ainsley Abeywickreme:
      Are you suggestion that all of that is yet to come? Seems like all of it is already here!

      • 1
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        Bloody good answer mate –

    • 2
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      do we have law and order now? why wait any longer.. we are in a lawless country… I bet Robert Mugabe’s Zimbabwe has better laws than SL…

  • 7
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    The people will be kept satisfied by shielding from any great difficulty using money borrowed commercially. GDP is maintained by borrowing and funding mega projects. This will continue until the debt bubble bursts.

    The ordinary people are not part of GDP, only the sycophants of the Govt and Family who benefit from Govt contracts. Meantime the Family & Co will siphon off a goodly amount and send abroad for their future retirement plan.

  • 1
    8

    Tisaranee Gunasekara,

    I detest the Rajapakas too.

    But don’t you think by whacking them over and over again and so frequently, you might actually be creating a ‘Stockholm Syndrome’ like situation, where the captive are enamoured by the captor?

    Think about it!

  • 6
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    We are heading in the right direction. An 8% growth is predicted by CB Governor, which is a figure that even most developed countries cannot boast of. So we are indeed led by group of individuals who certainly have their fingers on the masses pulse. . And know what’s best for them. Rich are getting richer whilst the poor are getting poorer. A night race is looming at cost of tax payers money and our gallant LTTE conquering military personal are working as coolies to ensure the first sons of the soil have a perfect race. It’s time we all rally around like the Arabian Springs to topple these scoundrels who are raping and pillaging in the name of governance. Their fingers are certainly in their pockets counting the moolah. Aiyo salli

    • 1
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      Well said….exactly my vision too…. A spring like the Arab one or the Tinaman Square, where masses “SAT IN” and asked the Military hardware to run them over.. The Miliary pulled back.. IT got to happen SOONER than later… Waiting for someone to start wont help. When and IF all think of being the

      • 1
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        Well said….exactly my vision too…. A spring like the Arab one or the Tinaman Square, where masses “SAT IN” and asked the Military hardware to run them over.. The Military pulled back.. IT got to happen SOONER than later… Waiting for someone to start wont help. When and IF all of us,think of being the 1st to lead the pack, there will be an enourmous crowd, who can make the rulers come down on their knees.. When and how are we going to start…is the question… We all can be Armchair Patriots, what is needed is ACTION, we are not part of NATO= No Action Talking Only…

  • 7
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    I Am sorry, Sinahlese think we are Gobbayos since we dont speak Sinhala properly, but today I like to tell you 98% of Sinhala people are GOBBAYO and GODAYO.. untill these 2 races are there MaRA will be kind forever.

    • 0
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      you are not a gobbaya if you have had an education . which a lot of Muslims dont bother with .

      • 1
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        what is the point in Sinhala Buddhist being educated? to bring into power the same Thakkadias? Stop being racist… IF SL is to come out of the rut…. or else there will be a war sooner.. not just with Muslims but all ethnicities together…

        • 1
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          The truth hurts ,

    • 3
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      Not you SURELY Hakeem is one of.
      He as minister of justice seems to be doing a job similar to pion. … THAT IS SAD BUT THE IT IS THE TRUTH.
      And the other Gobbaya is Azwer.. he is a failure.

    • 3
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      Dont worry, majority of Gobbayas are sinhalse.
      MR – the biggest Gobbaya – the became clearer through CHOGM.
      And his supporters like Abhaya and other commentators on this thread are examples for Gobbayas and Godayas
      They are talented at cleaning jobs only.. best examples are Banda, Abhaya, Jim and Sumana.

  • 0
    9

    Was Ms T in Cameron’s Press Corps….

    • 3
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      Did not you, get your Lap top?.
      Ah Ah , You have the other lap top, Fatihuba Fukasimba, know.
      Enjoy with that Lap top.
      still you hate others Who got TOPS?.

    • 8
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      Tsunamisekera:
      Why do you insist on confirming what a huge idiot you are?

  • 3
    1

    Economic Executioner with his Guru Deva.

  • 0
    7

    Tax Tamilians more.

    They get free education, free hospitals, free this and that but never pay tax.

    • 5
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      You are a raciest bitch.

    • 2
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      Fathima is a sad loser. Having nothing in the head, but owns a keyboard and computer. Tamils and Sinhalese fought for the freedom of this land in the 40s, while your ancestors were sitting in the back of your house picking their arse. Loser, go and get a life.

  • 3
    0

    The term Acolyte Capitailism brings me to guess that before the Budget
    preparations commenced a public request was made for suggestions-if this
    was the case some Bussinessmen would have ventured to request for certain
    taxes/reductions, whereby they could produce a kind of turn-over which BPJ and MR would have “worked” with the Bussinessman involved to arrive at their “cuts” conveniently? This is the kind of culture we now have.

  • 3
    0

    How come the self proclaimed jungle man of the south is now looking like an office man.Like the complete transformation of Tarzan when he was brought from the wilds into the city and had to be shown how to eat on a plate and flush the toilet etc.

  • 1
    2

    This [Edited out].

  • 3
    0

    All these taxes are mainly a)to prop up the armed forces,b) to prop up loosing state enterprises eg. Lankan Airlines and Mihin Air which have been gobbling up many hundreds of billions ever sice they were created,and are now to be ‘endowed’ with a further US $150 Million.,
    c) to ensure the luxurious lifestyle of the MPs who include the largest Cabinet in the history of all nations,and to finance luxury trips abroad to the minions of the regime d) to finance costly unnecessary infrastructures, eg the airport road which may be costliest in the world,without any transparent tender procedures.

  • 3
    0

    “a gargantuan military and a bloated defence budget – indicates, naked force will be the Siblings’ ultimate solution to the burgeoning economic malaise and its socio-political and electoral fallout.”
    Another North Korea in the making?

  • 0
    3

    Essentially TG talks about a class divide. Where according to TG the current policies making rich richer and poor poorer.

    However TG is very careful not to highlight the fact that the class divide is ethno/religious blind. i.e. Sinhala, Tamil, Muslim, Burger, Buddhist, Hindu, Christian among rich becoming richer and same ethno religious groups among poor becomming poorer.

    Hiding the commonality of problems faced by the masses is meant to confuse the issues. TG seems happy to keep masses divided so that they continue to fight each other.

    When bringing in examples TG never talks about companies like John Keels who immensely benefit from current economic climate in SL with their mega projects involving casinos etc. I wonder why?

    • 0
      2

      Private companies are commercial enterprises. Their function is to make more and more profit. They will exploit the economic climate to expand the business. If the climate is not created by the government they will not be there. On the other hand the government creates the climate to increase wealth anticipating benefits to the citizen downstream. Though commercial enterprises can be criticized on their business policies there would be no point in harping on it if the policies are based on government objectives.

  • 4
    0

    Epic failure of post war economy in SL
    is coming to light despite the road developments
    with borrowed money at very high interest rate
    that no genuine patriotic leader of a country
    would even consider. But for Rajapakshas, patriotism
    is something that exclusive to them and for those
    who say hosannas to the dear leader an his
    family. When countries are facing economic down
    turn, large infrastructure program would be
    undertaken as a measure of stimulating the
    economy. In SL, despite the fact that nearly
    20% of the population re-joined country’s
    economy after the war, stimulation of economy
    with barrowed money is needed to show GDP
    growth. It has been the case and continue to
    be the case after 5 years since the war was ended.
    With so-called massive improvements in the
    economy for consecutive 5 years, country’s
    main income source continues to be foreign worker remittance
    which comes with humongous social cost, then tourism
    being distance second. Rajapakshas know this
    madness will come to an end sooner or Iater and
    when that does happen, they need a fall guy. PBJ is
    coming handy for that. Minister Wimal Weerawasa”s
    relentless criticism of PBJ is to lay the ground work
    for burial of PBJ at the most opportune time.

    • 0
      4

      What epic failure ?

    • 0
      0

      What an A Hole PBJ. Is. Let them all rot in hell

  • 0
    0

    TG:

    You have been honest to your self this time. Generally, for Sinhala – readers, you write real problems and concerns in Sri Lanka and to the English medium, you ridicule and bash Sinhala -buddhists and Rajapakses.

    This time you chose to be fair for everybody and to be honest to your own conscience (?, will see).

    I see how Rohitha Rajapakse behaves as a rich prince in struggling Sri Lanka. I remember how ancient Indian Princes behaved as well as how Mrs. Marcos like people lived.

  • 0
    0

    Don’t worry! all the fools are get to-gather to destroy the pearl of the Indian Ocean. There are some fools among degrees! Aren’t there?

  • 0
    0

    Once upon a time, a King in India imposed a urine tax on a people already over burdened with taxes. The irate people wet their tax coins in urine before paying up. Very soon the treasury was smelling to the high heavens! The King learned his lesson quite fast!

    Let us await our urine tax next year.

    Rajasingham Narendran

    • 0
      0

      You are giving unnecessary ideas to mahinda.Due to you we might be landed with a fart tax.Then the treasury won’t smell.

      The king you mentioned was lucky that he did not impose a shit tax.

  • 0
    0

    BTW a tax on arse licking which is a part of our 2600 year old culture will bring in a lot of revenue and solve the financial problems.

    • 0
      0

      Eventually there won’t be much of a demand for toilet rolls!

  • 0
    0

    Yes, you are a fool. That is why you keep on pouring water on a Ducks back

    • 0
      0

      wickrame,but you are not a duck because you responded.A sucker, at last.What hurt, your shitty culture part or your traditional arse licking part of my comment,or both?Truth hurts they say.

  • 0
    0

    and wickreme,i suggest you learn to take on constructive criticism without getting angry,so stop licking arses in future and put your 2600 year culture also up your arsehole where it belongs.

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