|
March of the Professional |
|
Taxation and Ethics
N. M. Ranka |
|
Taxation is a power of political superior and realization of taxes is essential for meeting State expenses, which are meant for governance. The needs of governance in a Police State are limited but in a welfare State are far more and, therefore, the occasion for greater taxation in a Welfare State is understandable. There is justification for greater taxation in a welfare State, the reason being the State has to undertake several obligation like providing health, education, justice, security safety, infrastructure development, roads, transport, and to do many acts to justify, it being called the welfare State.
The tax laws are complicated, complex and highly
technical. Interpretation of tax laws is painful and difficult. The legislature
adds to agony by amending frequently and retrospectively. It may be legal but is
immoral and unethical. It puts a greater injury to a citizen and shakes faith of
the tax payers to adopt immoral means. Making way simpler towards such dirty
path is not in national interest. During the last four years number of judgments
of the Hon’ble Supreme Court have either been nullified by blanket amendments or
have been overruled causing avoidable agony. VAT was introduced with model
legislation drafted by the Union, but enacted diffective from different day.
Service Tax has been introduced and expanded each year but without one
enactment. Till date there is no Service Transparency is absent. Work culture is no more. Discipline has diminished. Right hand does not know what left hand is doing. Corruption is at its peak. Many officials possess in tons and lead aristocratic life, accountable to none even to oneself. Image of the tax administration has tarnished. An honest tax collector is under shadow of suspicion. Honest officers suffer. There number is now negligibly few. It is for the tax administration to evolve ways and means whereby an honest, upright and clean tax-payer is provided atmosphere to remain honest and clean and is not dragged to the path of corruption. The tax-payers are not basically corrupt but are corrupted on account of uncertainty of law and ill-treatment received at the hands of the tax administration. Lately, a highly damaging, destructive and agonizing trend has developed and is flourishing. In the words of Hon’ble Mr. Justice Ahmedi, Former Chief Justice of India, ‘those who indulge in the game of numbers are preferred as against those who raise legal and technical objections’ former get priority and latter are discriminated, harassed, distressed, suppressed, commented, criticized and sometimes misbehaved. One who grease the palm and pay is privileged and very very important person in the eye of large number of tax authorities. Hon’ble Mr. Justice R. C. Lahoti, Former Chief Justice of India stated : “Corruption is cancer eating into the roots of the society. It is difficult to fight against corruption because the chances of success are bleak but this is no reason for despondency. Nobody is born corrupt; it is the vitiated atmosphere in the society and the system of governance which converts the clean into corrupt. An honest person resists corruption but allurements and temptations at times prevail upon him and once corrupt, even an honest person prefers and finds it convenient to stay corrupt. The seeds of corruption are sown in the mind of the man and the cure, if any, lies in eradicating the seeds of corruption from his mind’’. Power corrupts a person and tax administration is no exception. There is a sudden spurt in instances of corruption; the corruption is showing its origin at the top and percolating downwards; there is a tendency to protect the corrupt and bound the honest; excepting highlighting the issue in media there is no revolt nor remedial steps taken against corruption. and people are getting used to corruption as a necessary evil of the system or a ‘part of life, During the last 15 years not only image of Tax Administration/Income Tax Appellate Tribunal, other Tribunals but also some of the constitutional functionaries and the tax profession has tarnished. The tax-payers are loosing their faith and trust and are labelling the tax practitioners as ‘’ dalals.’’ Some have been caught red handed. There appears to be a tripartite agreement in between the tax-payers, tax-payers, tax collectors and tax practitioners, to share the booty at the cost of national exchequer, meant for teeming million poor and downtrodden citizens. It is apparent that there is no WILL on the part of the Legislature and the Executive to curb corruption. Even those who have been caught red-handed, escape for want of adequate evidence and competent investigative and prosecuting agency. The morel fibre of the Nation is getting weaker day by day and ETHICS is absent. The tax practitioners should have the professional capacity, proper professional training, the good knowledge of tax law and the procedure. They should see that the tax-payer remains on the right path and is not misguided or ill-advised. A strong, united and independent bar, ready to see that justice should be done, will have a very sobering effect on the tax administration. First of all, the tax profession should get rid of corrupting elements prevailing in its ranks. The members must unite to fight this evil. It is a shame to our country. Unity is strength. A sense of sacrifice and sense of service would be required to tackle this problem. We need – (i) to devise credible strategies to tap this vast reservoir of tax so as to leap frog in the race for social and economic development; (ii) there must be utmost emphasis on the creation of a transparent and non-discriminatory tax administration–regulatory regime which minimizes scope for corruption and arbitrary exercise of power; (iii) we have to learn lessons of duty, discipline, trust, mutual respect, time management, efficiency and punctuality; (iv) our tax policy must be viewed in an integrated holistic perspective, with change in the mindset of tax administrators; (v) we must equip ourselves to face the global economic environment,both opportunities and challenges and seize the opportunities now on the horizon; (vi) our public finances need to be restructured and reformed to cut fiscal deficits and to generate resources for addition in nation infrastructure, health care, education, social security and protection of the weak and the under privileged, (vii) we must resolve to pay and get collected due taxes without fear and favour; not to indulge in malpractices and to maintain ‘ETHICS’; (viii) with the New Year, we should have introspection and resolve to correct ourselves and ‘BUILD THE NATION’. ‘’FEAR NONE, EXCEPT ONE, WHO IS ABOVE EVERYONE’’. Respected Mahatma Gandhi, Father of the Nation said ‘’THERE IS HIGHER COURT, THAN COURT OF JUSTICE, THAT IS THE COURT OF CONSCIENCE.’ [Source: Article printed in Souvenir of Two Day National Tax Conference held on 7th and 8th March, 2009 at Varanasi.] |