The Chief Editor of Nagarik National Daily in Nepal has written a very good editorial on its web edition of August 11, 2013. The subject concerns with the people's right to spend wherever they wish to. The Article has been titled as "हुनेले सकेजति खर्च गर!" in Nepali which can be translated as "Spend as much as you can (if you afford to)".
The article is written on the background of caution notice, in general, from Nepal's Commission on Investigation of Abuse of Authority (CIAA) asking people not to spend unnecessarily in social and cultural functions and in parties like in marriage, Bratabandha (Thread Ceremony), and in Anniversary etc. Post such issuance of notice, it is reported that Nepal's one advocated cancelled the party scheduled to be organised on occasion of his son's marriage. The advocate has been reported to have said that he has paid a heed to such notice issued by CIAA.
With respect to the subject matter, Mr. Pradhan writes in his editorial whether CIAA has such power to issue notices with respect to the enforcement of Nepal's one of such archaic laws. Mr. Pradhan argues that CIAA is entrusted only to take actions against public servants if they have committed acts of corruption or any such corrupt practices by abusing the authority of the law or position. Mr. Pradhan further questions if CIAA wants to usurp such powers to enforce such other laws than for which it has been established. Can CIAA do so? and Are we under an obligation to submit ourselves before the jurisdiction of CIAA? This part of the editorial is well argued on the basis of various sections under the CIAA Act. The Editor, Mr. Pradhan has not concluded anything in the article but he has brought his point very well - can CIAA act like a law enforcement authority? also, is the public law restricting the number of people in a social function relevant in the current Nepali society? This is the first part.
On the second part of the article, Mr. Pradhan positions himself as a champion of free market economy but without clearly stating so. His point is to let the rich spend on their own whims and fancies so that poor gets benefited. The point is if a rich throws a party, he will buy rice, vegetables, meet, milk etc. from the poor or from some businessman who in turn employs a poor man. Finally, the money reaches to a poor man and economy gets benefited.
While putting down his arguments, he argues that the money will not be spent in the country if such prohibitions are placed in place. His fear is such monies may be spent in Delhi or Singapore rather than in Nepal. He fears the capital flight which is understandable. In the whole article, he shows how money is spent by government by passing budgets and in a way shows his convictions on 'Keynesian economics'.
His arguments definitely have points. But,
His writing is completely silent on checks and balances on such expenses. His point advocates rampant spending on parties if people can afford to pay. But, how that directly benefits the economy is hard to say without any hard data and evidence.
Has he made any study what is the percentage of such monies that are spent on alcohol? on imported liquors/cigarettes? Spending high amount on alcohol (both domestically procured and imported) does not bring any intended benefits of the nature Mr. Pradhan believes. What about crimes associated with parties? The social cost of drinking and injury or say, increase in crimes - targeted at the spender? I am only raising these issues which Mr. Pradhan does not bother to touch. Unfortunately, he simply claims that people will not make any competition in spending if such laws are not enforced which is hard to believe in either way.
I am not the one who believes spending by citizen should be discouraged but will definitely not advocate for scrapping of such laws which try to regulate unfruitful spending. The law may be outdated and may need revision. That is a fair point but to ask to scrap it completely is to turn a deaf ear on Nepal's gross imbalance of haves and have not.
Some of the procedures that might be followed to regularise such spending are:
- To mandate to make payment only through Cheque if the payment exceeds some threshold amount, say more than Rs. 50,000/- (to curb the black money),
- To quote payee's Income Tax Registration No./Business Registration No. on such payments,
- To increase the rate of VAT on such renting of party palaces,
- Increase VAT/excise duty/imports duty on cigarettes and liquors,
- Most probably to impose VAT on sale of food and drinks if party palace is licensed to sell alcohol. Some tax discounts (lower rate) on sale of food when alcohol is not served in party palaces.
My point is that we can not afford to be so liberal when it comes to spending on unfruitful ventures. If we are able to create some sorts of equal society in the future, we can afford to be so liberal but not just yet!
The Original Article can be read here.
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