Opinion: It is time to Crackdown on Tax Evasion by Somaliland Cellular and Internet Operators

On Saturday evening, Bihi hosted a Ramadan Iftar dinner for the businesspeople and clergy to raise money for the merchants, who lost everything in the Waaheen Market fire. The Ramadan is the holiest month of the Islamic Calendar, and a month of charity and giving. Although the government’s intention is good, the ad hoc effort for disaster response is not enough. Instead, the president should set up through executive order an emergency management agency responsible for the prevention, mitigation, preparedness, response, and recovery for all disasters, including droughts.

We should not be begging for funding disaster relief from the merchants of corruption who pay little to no taxes and those who hate Somaliland. It is time for the Ministry of Treasury to get serious about collecting all past dues taxes from these merchants, especially the communications and money transfer sector.

Why has the government failed to collect taxes from the Telecommunications sector instead begging money from them? Because except for Egal, all SL administrations have been colluding with the greedy merchants. They exploited the corruption and weak governance in our government.

Moreover, they also bribed and bought the so-called Somaliland’s YoutubeTV media, as the result, there is no coverage on their tax evasions.

The predatory elite from the Telecommunication/Money transfer sector are very determined to undermine our freedom, rule of law and public safety They are against a strong, effective government taking root in the country, able to collect taxes and properly fund public safety, including police, firefighters, and emergency management, and invest in social programs to help the poor and fight the abject poverty.

For too long, Cellular and internet providers have turned a huge profit while evading taxes. As it stands, cellular operators and their so-called banks are little more than a conduit to launder the stolen aid money by government officials to foreign banks in Djibouti and Dubai.

For example, the Mogadishu based Hormuud Telecom owns Telesom and controls all cellular communications of Somalia, including Somaliland. Telesom has never officially released or published their financial results since its inception in 2002, or even last year, regarding its gross revenue, net profits, and assets. Some shareholders are not aware of the performance of the company.

Similarly, Dahabshiil group aka Dhiigshill jumped into Somaliland’s saturated mobile business, after launching Somtel with the e-Dahab service in 2009. However, Somtel subscriber wise lags Telesom. Although it’s a family held company, there’s no transparency and accountability on taxes. We don’t know anything about the group’s financial statement.

It is unacceptable for both Telesom and Somtel to use our spectrum radio bandwidth and pay little or no taxes. People have the right to know how much taxes these firms paid to the coffers of our treasury, since their inception?How much money each of them is paying for the cellular license to operate in Somaliland?

We don’t know because everything in our government is done in secrecy and backroom deals, especially the Ministry of Treasury headed by a former branch manager for Dahabshiil, Dr Saad Ali Shire. Dr Saad, who had been a member of the previous corrupt Silanyo/Hersi administration, had done a terrible job when he was a Foreign Minister. A lot of people who support President Bihi, do not understand why Dr Saad is still in the cabinet. He knows where all the skeletons were buried.

We should have to auction our cellular Spectrum radio bandwidth to fund the Emergency management agency. According to some estimates, the government should be able to raise hundreds of millions of dollars if not more from the auction, duties, licensing fees, and other past due taxes.

A money that could fund our  ill-equipped police and firefighters. For instance, to be a police officer you have to bring your own assault gun. The police officers do not have riot gears for crowd control. Our firefighters have very limited access to protective clothing and often turn out to jobs without the equipment needed to keep themselves safe.

By contrast, this past year, Safaricom, Kenya’s largest cellular service provider paid Ksh 106 billion (919 million USD) in duties, taxes, and license fees to the government of Kenya. Since its inception in 2000, Safaricom has paid the Kenyan Government KSh915.42 billion (7.93 billion USD) in taxes and license fees. For the 13th year in a row, the telecommunication company is the top taxpayer in Kenya.

We should at least impose a 20% corporate income tax. Because we can’t fund our government on the backs of produce and milk vendors and small retailers, Hargeisa property owners, and the Tariffs on imported goods.

We must crackdown on corruption and bribery in our government and merchant/clergy communities. Muslim religion prohibits corruption and bribery. In fact, Prophet Muhammed (PUB) said, “Allah curses those who give bribes and those who accept them.”

But bribes, deception, dishonesty, and lack of transparency become their modus operandi.

The tragedy at Waaheen market fire exposed the vulnerability of public safety. Bihi must do the right thing: From focusing on the merchants of corruption to protecting the safety of ordinary Somalilanders, who see the slow response of the government to Waaheen market fire, higher inflation, and recurring droughts.

The primary responsibility of the SL government is to guard the security and freedom of the Somaliland people. We need an effective cabinet level emergency management agency and with appropriate funding ready to respond to any future disaster. The President has a chance to make history by cracking down on tax evasion by Cellular and internet operators. Because we cannot only rely on charity for funding public safety and disaster relief.

The Alternative would be for him to become another African leader who is taking cue from corrupt merchants, tolerating corruption and abject poverty to his own people, and denying them the opportunity to improve their lives. While the few greedy and rich became powerful enough to control our government.

This is food for thought!

Ali Mohamed
Founder and Editor

Gubanmedia.com

aliadm18@gmail.com