Corrupt quotas

The government’s decision to increase taxes on vehicles has caused a bit of stir.

Many people I’ve spoken with agree with the progressive taxes based on engine capacity. But most, like I, doubt if simply increasing taxes will help achieve the government’s goal of controlling the growing number of vehicles in Bhutan.

Why? Because public transport, in Thimphu and elsewhere, is still inadequate. And, in the absence of a reliable public transport system, we will continue to buy cars, even at relatively higher prices. A real reduction in traffic volume will be possible mainly by improving the public transport system to provide adequate coverage, and to make the service cheap, punctual, comfortable and, most importantly, popular.

But there’s another reason why increased taxes will not affect sales of imported cars: allotment of foreign vehicles, commonly called “quotas”, to public servants. Civil servants in Grade 6 and above are entitled to a quota once every seven years. And senior officers in the armed forces also enjoy a similar entitlement. Last year, some 380 quotas were issued. The year before that, many more, as every MP also received a quota.

Obviously, some public servants use their quotas as intended, that is to purchase vehicles for themselves. But many quotas find their way into the black market – they are sold, illegally and at hefty prices, to buyers who can then avoid paying duties and taxes.

So ordinary quotas – those that exempt taxes and duties on Nu 800,000 of a vehicle’s cost – were selling for about Nu 45,000 before the government’s announcement. Today, they already cost Nu 100,000.

The price for “Prado quotas” – those that exempt all taxes and duties for Toyota Prados – has also doubled. They are only a few of them left, and they were selling for Nu 200,000 until the day before yesterday. Today’s price is a whopping Nu 400,000!

The allotment of foreign vehicles to senior public servants costs the exchequer dearly. But worse still, it causes rampant corruption. So it should be discontinued. And in its place, monetized entitlements should be provided.

Improve public transport. And discontinue quotas. Only then, will the government be able to control the growing number of vehicles.

Excavating dirt

Dirty business

Two weeks ago, I accidentally telephoned Passang Dorji, the chief reporter at The Journalist. I’d meant to call someone else. But somehow, I dialed Passang’s number instead. So we made use of the unforeseen opportunity to catch up.

I asked how he was doing. And how their new company, The Journalist, was faring. He replied that the times were difficult; and that they weren’t making enough money; but that, with support from friends and relatives, they were pulling through.

Passang also confided in me. He told me that they were working on a scoop – a story about members of parliament and ministers buying excavators; and about them leasing the equipment to the Punatshangchu Hydropower Authority.

He asked me for my opinion. I told him that our laws forbid members of parliament from engaging in commercial activities. And I told him that, as far as I knew, no law prevented family members, including spouses, of parliamentarians from doing business. But I encouraged him to work on his “scoop”, especially to investigate for political corruption and conflicts of interest in the Punatshangchu case.

Then I told him that it might interest him to know that my wife also owns two excavators; that both of them were bought on loan; that one of them was working for a Bhutanese contractor involved in the Punatshangchu project; and that the other was lying idle.

I suggested that he should talk to my wife. I advised him that he might want to ask to see the business income tax returns that she would soon have to file.  And I informed him that my wife and daughter were accompanying me to my constituency in a few days.

Passang Dorji didn’t contact me. Nor did he contact my wife. And this is what The Journalist had written:

The opposition leader, Tshering Tobgay, also confessed to having two excavators in this wife’s name and that one was already deployed at the PHPA site. He could not be contacted for further details. He was in Haa and was unreachable through cell phone.

Yes, the excavators are in my wife’s name. And I cannot deny that they belong to our family. But to insinuate that I had tried to avoid detection; that I was made to confess; that my wife was just a front; and that I was actually doing the work is irresponsible.

So I telephoned Passang Dorji again. He confirmed that he didn’t know about my wife’s excavators before I volunteered that information. He claimed that he didn’t write the article. And he admitted that the part about the opposition leader could be misleading.

I’m not making excuses. I’m just setting the record straight.

My wife’s company is called GT Hiring. She owns two excavators, each worth about 47 lakhs, that she bought in September 209.  She owes the Bhutan National Bank about 90 lakhs. One machine works for Ringdol Construction, a local contractor. And the other is idle.

I encourage The Journalist to meet my wife. She will convince them that GT Hiring is her business; that she’s not fronting; and that her husband is forbidden from interfering in her company’s matters. But that said, it does not mean that I bear no accountability. I will accept full responsibility for my wife’s business, if what she does is illegal. Or if it interferes, in anyway, with my work as a parliamentarian and the opposition leader.

The Journalist promised to investigate the excavator stories in detail. I encourage them to do so. We must not allow MPs to use their influence to get into business. We must take conflicts of interest seriously. And we must not allow political corruption to breed.