Every human being has two options, to complain or not. Complaining is perhaps the easiest thing we can do besides breathing – it takes little effort and can be communicated in diverse ways, including loud or silent responses to situations. It is normally perfected in children.
As we mature, we may learn to: (i) examine situations, (ii) define problems, and (iii) design solutions. We may also obtain the resources needed to fund the solutions and gain the courage to implement them. We should be modelling this pattern of behaviour to benefit the next generation.
OBTAINING AUTHORITY.
Where we are forbidden from implementing a solution to a problem, we should share the solution with those who may implement it. If they choose to allow the problem to grow out of control and harm people, then an interim solution may be to obtain the authority to solve the problem.
In our democratic system of government, the only way to obtain the authority to solve national problems is to compete with other political parties for votes to manage the national economy every five years. Once the people have made their decision, it should be accepted – without complaint.
THE VAT PROBLEM.
The Value Added Tax (VAT) is perhaps the most unfair and harmful tax ever conceived. It has been adjusted several times because of its unfairness, but it continues to be unfair and harmful.
Perhaps the most harmful part of the VAT is the mandate to pay it when an invoice is issued, rather than when payment is received. The VAT Act (CAP 87), Section 16.1 states:
“(1) Except as otherwise provided in this Act, a supply of goods or services takes place for the purposes of this Act when: (a) an invoice for the supply is issued by the supplier; (b) payment is received for the supply; or (c) the goods are made available to the recipient or the services are performed, as the case may be, WHICHEVER IS THE EARLIEST.” (Emphasis mine)
MERCHANTS.
This method of paying taxes is easy for merchants whose transactions occur over the counter – customers pay first and then take possession of the product. The merchants then take the VAT portion from what they are paid and pay the tax when it is due.
For those in services who invoice their Clients monthly, payment may come several months after an invoice is issued for services already rendered. An example from construction services may be instructive.
CONTRACTORS.
A Contractor working on a $12M project may invoice a Client for $1M every month for 12 months. However, he may receive his first payment seven months after submitting his first invoice. Every time he sends an invoice, he must find $175,000 to pay VAT, even though his Client has not yet paid him.
After 6 months, he must pay over $1M in VAT, using his own resources. Clearly this is both harmful and not fair to such service providers.
A SOLUTION.
Since the VAT was implemented in 1997, I have suggested to the authorities that when the Government is the Client, a supply of goods and services should only be recognised under Section 16 when payment is made, given the history of Government paying late.
After almost two decades of active lobbying for fair solutions in the public’s interest, I tried to obtain authority from the public to make those changes – to benefit the public. The voting public repeatedly made their decision. So, we must learn to accept unfair and unjust national policies without complaining, knowing that a better life follows this one.
The blogmaster invites you to join the discussion.