By

C.A.Chandraprema

The passage of the US sponsored resolution against Sri Lanka without a vote in the UNHRC is being hailed in Sri Lanka as a major victory for the government. The prime minister himself went on record as saying that Sri Lanka has now been ‘taken off the UNHRC agenda’. He was also reported in the media as having told the service chiefs that there will be ‘no court hearings’ and there will only be a truth commission.

As this writer has been saying all along, if the government of Sri Lanka chooses to ignore any resolution in Geneva, there is nothing that the UNHRC can do about it. In this case, the main sponsor of the resolutions against Sri Lanka the USA, now considers itself an ally of the present Sri Lankan government and it is unlikely that they will press for anything that has the potential to reduce popular support for this government.

The UN Human Rights Commissioner is supposed to provide an oral update to the UNHRC next year and a comprehensive report on the implementation of this resolution the year after next. By that time the Obama administration in the USA will be no more, along with the officials who were pushing for action against Sri Lanka and most probably a Republican government may be in power. So the present government, if they so wish, can from this very moment simply forget about Geneva and get on with the business of governing. What was always important was not what went on in Geneva but what the government of Sri Lanka intended to do. They could either fight the resolution in Geneva and flatly refuse to implement any of it, or they could allow anything to be passed in the UNHRC and simply ignore it afterwards. Either way, the end result will be the same.

The Office of the High Commissioner on Human Rights has been appointed to supervise the implementation of the resolution. However the OHCHR depends for most of their funding on the very powers that sponsored the resolution against Sri Lanka and they can be manipulated. He who pays the piper calls the tune as the old saying goes. So there are infinite possibilities to simply sweep this resolution under the carpet and forget about it. Had the Americans not taken the floor against Sri Lanka, none of the resolutions against Sri Lanka would have been passed. Getting those resolutions against Sri Lanka passed with slim majorities was a wrenching experience even for the USA. Dozens of US State Department officials were busy in Geneva canvassing votes against Sri Lanka and even with all that the USA managed to get only 23 votes in a 47 member council last year. It is unlikely that any other country will undertake such an exercise given the trouble the USA had.

Nimal Siripala de Silva’s statement that the law of the country and even the constitution itself will have to be amended if this resolution is to be implemented and that these things take time, is a step in the right direction. Silva said that even a referendum may be necessary to make some of the amendments. President Maithripala Sirisena’s move to summon an all party conference to discuss the resolution is another step in the right direction. It will be foolhardy for any elected government to take upon itself the responsibility of implementing a resolution of the kind that was passed in the UNHRC last week. The inability to arrive at a consensus in the All Party Conference can be a convenient excuse to put off everything relating to the UNHRC resolution.

It can clearly be seen that some of Sri Lanka’s so called ‘international partners’ are more interested in getting the resolution implemented than the Sri Lankan government. For example the Japanese Ambassador in the UNHRC announced that they would be sending an experienced war crimes prosecutor to Sri Lanka this month but there is no joyful announcement on the part of the government welcoming the visit of this individual. In the final analysis we all have to acknowledge that all governments have come under pressure from overseas to do various things that are not politically feasible in this country. One good example is the controversy over the CEPA with India and the Hanuman bridge. The Indian press is full of enthusiastic talk about these pet projects of the Indian political establishment but the government of Sri Lanka is not just maintaining a stolid silence on these matters, but actively denying that any such talks were held. Now a government wielding power is not going to deny that they are for CEPA and the Hanuman bridge and then implement such projects because by the very act of denying that they are for such projects they have contributed to justifying, and bolstering opposition to both CEPA and the Hanuman Bridge.

So it is with the UNHRC resolution. If the prime minister has assured the service chiefs that there will be no court hearings whether hybrid or domestic we have to take that at face value and give the government some leeway. There are some operational paragraphs in the UNHRC resolution which a government cannot implement without considerable political fallout. They may be of interest to certain foreign powers and Tamil political groups both in Sri Lanka and overseas but they are of little interest to most members of the government and would be regarded as an unwanted headache by the average government minister. Implementing operational paragraphs 6 & 8 of the UNHRC resolution in particular will be suicidal for any government. Though the government claims that the UNHRC resolution agreed to a purely domestic mechanism, that is far from the truth. Operational paragraph six did agree to a ‘Sri Lankan judicial mechanism’ but at the same time affirmed the importance of the participation of foreign judges, prosecutors and investigators in this Sri Lankan mechanism.

So what the UNHRC resolution still envisages is in fact a hybrid court in all but name. The government however can filibuster and prevaricate and postpone and mumble excuses and hold endless discussions and ensure that there is no court at all whether domestic or hybrid! And if this government has any political sense, that is exactly what they will do. Operational paragraph eight which encourages the government to purge the armed forces through an administrative vetting process of individuals suspected of human rights violations (even if there is insufficient evidence against them to prove wrongdoing in a court of law) is another recommendation fraught with danger. If the government was not able to talk the sponsors of the resolution into dropping such recommendations, the next best thing to do is to simply ignore them once the ball passes into the Sri Lankan side.

This is a time when the government should be creative. A good example is the 2006 case of Sinnarasa v Attorney General which was heard when Sarath N.Silva was the chief justice. This was a case where a person convicted for terrorism related offences who had exhausted all appeals in Sri Lanka, then made an application to the UN Human Rights Committee. The government of Sri Lanka had made a major faux pas during the Chandrika Kumaratunga era by signing Optional Protocol I of the International Covenant on Civil and Political Rights and thereby accepted the right to Sri Lankan citizens to approach the Human Rights Committee in Geneva for redress. But when the judgment in the Sinnarasa case was brought back for the Supreme Court’s consideration, the SC flatly refused to accede saying that the government which is the executive arm of the state cannot by signing an international treaty, make that law applicable in Sri Lanka and that it was only the parliament that had the legislative power to make Optional Protocol I operational according to Sri Lankan law.

There is no reason as to why the same approach cannot be taken with regard to the present UNHRC resolution. The government and the judiciary should act in unison in safeguarding the sovereignty of the country. In fact operational paragraph seven of the UNHRC resolution acknowledges that the domestic law of Sri Lanka has to be amended if any of the recommendations in this resolution are to be implemented. In some cases, even the constitution itself may need to be amended and as Nimal Siripala de Silva has already pointed out, these things take time. Above all else, the government should be mindful of the fact that by assuring the people that ‘nothing will happen to the war heroes’, that there will be only a domestic inquiry and that there will be no foreign judges sitting in judgment over our war heroes they themselves have accepted that none of these things should happen.

Furthermore, since they are finally dependent on public goodwill to remain in power, they should not create certain expectations and then do the opposite in practice. Even the pro-yahapalana website Colombo Telegraph commented on the manner in which posters had been put up in Colombo by the Maithripala Sirisena controlled UPFA hailing the president for saving the country from the ‘imperialist death trap’ (adhirajyawadi mara ugulen). Since that is the government’s own rhetoric on the matter, they cannot without suffering a serious political fallout, implement the UNHRC resolution.

‘Revenge levy Bill before parliament

We see from the foregoing that there is a way out for the government on the Geneva issue if it wants to take that path. But on the domestic front the government appears to be intent on shooting itself in the foot. A good case in point is the Finance Bill that is now on the order paper of parliament which aims at among other things, to charge the super gains tax of 25% from companies that made more than Rs. two billion in profits during the 2013/2014. Among the other taxes that this bill seeks to impose are the following.

Bars and Taverns Levy – Rs. 250,000 per licence holder.

Casino Industry Levy – Rs one billion per casino establishment

Super Gains Tax – 25% on all companies that made a before tax profit of Rs two billion or more in the financial year 2013/2014.

Mobile telephone operator Levy – Rs. 250 million from each company engaged in the business.

Direct to home Satellite TV Services Levy – Rs. one billion per operator (will apply to operators having more than 50,000 subscribers.)

Satellite Locations Levy – on all persons who owned satellites and were permitted to use the Sri Lankan satellite locations – Rs. one billion.

Dedicated Sports Channel Levy – Rs. one billion

Mansion Tax – Rs. one million per mansion for mansions built after 2000 exceeding 10,000 square feet or valued at over Rs. 150 million. This tax will have to be paid every year.

Migrating Tax – 20% of the foreign exchange released to be taken out by a citizen of Sri Lanka migrating to another country.

Motor Vehicle Importers Licence Fee – Rs. 1.5 million on each motor vehicle importer.

Various collecting agencies raging from the Commissioner General of Excise to the Commissioner General of Inland Revenue, the Local Authorities and the Telecommunications Regulatory Authority – depending on the nature of the Levy – have been named in the Finance bill that seeks to introduce these taxes and all these agencies are supposed to send the money collected to the consolidated fund. If anybody fails to pay these levies, the collecting agency can refer the matter to a magistrate and the latter can take steps to levy the money due as if it were a fine imposed by the magistrate. (If you fail to pay a fine imposed by the magistrate’s court, you have to go to jail!)

In the case of those holding liquor licenses, non payment of the levy of Rs.250,000 may even result in the cancellation of the license itself. Furthermore, if the establishment is a company, the directors and officers of that company and if it is a firm every partner in the firm and if it is a proprietorship, every officer involved in its management and control will be liable to be prosecuted for the recovery of the dues under this act!

Of all these taxes, the one that may have the most negative impact on the economy is probably the super gains tax on companies that made profits over Rs. two billion in the year 2013/2014. If the aggregate profits of a group of companies exceeds Rs two billion, this tax will be levied anyway, notwithstanding the fact that the profits of the individual companies coming under that group have not made profits amounting to Rs two billion for that year. If however the profits of one company within a group of companies exceeds Rs two billion, but the aggregate profits of the other companies within that group plus the holding company does not exceed Rs two billion, the levy will be charged only on the company that made the Rs. two billion. Even Board of Investment Companies that have started paying taxes after the expiration of their tax holidays will have to pay the super gains tax.

This tax is supposed to be treated as an ‘expenditure’ on the part of that company for the year 2013/2014 and no tax deductions will be allowed for any year of assessment for having paid this super gains tax. This in effect means that the companies paying this will have to pay their normal corporate taxes in addition to the super gains tax. The total amount the government hoped to realize from this levy is as follows.

Bars and Taverns Levy – Rs. 1,000 million

Casino Industry Levy – Rs. 5,000 million

Super Gains Tax – Rs. 50,000 million

Mobile telephone operator Levy – Rs. 1,250 million

Direct to home Satellite TV Services Levy – Rs. 2,000 million

Satellite Locations Levy – Rs. 1,000 million

Dedicated Sports Channel Levy – Rs. 1,000 million

Mansion Tax – Rs. 1,000 million

Migrating Tax – Rs. 100 million

Motor Vehicle Importers Licence Fee – Rs. 375 million

Total: Rs. 62,725 million.

Projecting a revenue of Rs. 50 billion from the super gains tax means that many top companies will have to fork out hundreds of millions of rupees to the government in addition to their taxes for the current year. This will throw the investment and expansion plans of the most profitable businesses in the country into total disarray. The exactions on mobile phone operators and satellite service operators will have the same effect and if there is some overlap between these companies, some will end up paying more than one of the many taxes in this bill. Even after imposing all these exactions the government cannot raise enough money from this levy (assuming that the collection of revenue will yield the projected amount) even to meet the increase in the public sector wage bill which the government has calculated as Rs. 89 billion. (This is just the increase of Rs. 10,000 not the total wage bill.)

Furthermore, except for the mansion tax and the tax on motor vehicle importers, all the other taxes are supposed to be one off exactions. Besides, all these taxes were supposed to contribute to government revenue in 2015. How the government is going to meet the shortfall in revenue in 2016 is anybody’s guess. (As we write this, we hear that the taxes on cigarettes and liquor have been increased.) Be that as it may, the negative effect that these levies envisaged in the Finance Bill now before parliament will have on the economy will no doubt have an impact on the government’s collection of revenue for 2016. The Finance Bill imposing these levies was placed on the order paper of parliament on 22 September. According to the constitution, anybody could have challenged the constitutionality of this bill in the Supreme Court within seven days of it being placed on the order paper of parliament. However nobody seems to have had the courage to challenge this patently unfair levy in courts for fear of rubbing the government on the wrong side.

The day before this bill was placed on the order paper of parliament, there was a scathing article on the EconomyNext website about these ‘revenge taxes’ and ‘fiscal tyranny’ but not a peep in protest thereafter. It appears that the top companies have resigned themselves to passively accepting these punitive levies. What that will do to the economy is another matter.

Politician remanded for facebook post

For a government that came into power promising good governance, the yahapalana types have been remarkably adept at spreading a fear psychosis around. A case in point is the remanding of Sampath Atukorale the deputy chairman of the Southern Provincial Council for having allegedly defamed President Maithripala Sirisena in a facebook post. One of the first to unconditionally condemn this as an impediment to the freedom of speech was the pro-UNP website Lanka e News which said that Atukorale had been arrested and remanded even though President Sirisena had not made a complaint to the police. Furthermore, LeN argues that to remand a person for having posted a comment in his own facebook account expressing his personal opinion about a leader is quite normal in this age of modern technology and that regarding this a crime is clearly a case of stymieing the freedom of expression. LeN also points out that this incident occurred just 72 hours after the prime minister was seen presenting an award for media freedom and that this could be a part of a conspiracy to bring the yahapalana government into disrepute and ridicule among the new generation.

Courtesy:Sunday Island