Going right about taxes

The launching of a study on tax evasion by the Economic and Social Council, sponsored by the Spanish Agency for International Development, could get the country closer to having a better, more balanced budget if it succeeds in identifying the real reasons for this problem.

According to the proposed study, at stake are about JD1.9 billion in unpaid income and sales taxes.

The presence of the prime minister at the launching of the study testifies to its importance. It should also be taken as a clear message that tax evasion will no longer be tolerated.

The phenomenon is not characteristic to Jordan alone. It is a global problem, often one whereby individuals believe that they can outsmart the system.

It is true that Jordanians are among the nations on which the most taxes are levied, and that might encourage tax evasion. But often the evaders are rich citizens, and often they get away with it.

That said, the best way to make sure that the phenomenon of not paying taxes is reduced to a minimum is to collect taxes at the source, instead of relying on collection mechanisms that may leave the door open to evasion.

Still, the problem will not be fixed as long as the structure of taxation is cumbersome and applied in a heavy-handed way.

The country needs a more simplified system of taxation and, above all, a fairer one.

By and large, Jordanians are poor and can ill afford the multiple tax system that is currently in place.

Most people are salaried employees with moderate incomes. While these are taxed as per the letter of the law, there are those who are taxed according to their submissions, which quite often are not the most truthful.

It should not be too difficult to calculate taxes for any money earner. Needed, however, is the right mechanism for calculating and collecting taxes, and, above all, fair dealing with taxpayers.