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Naga rebels set up alternative tax structure

india Updated: Nov 05, 2013 09:22 IST
Rahul Karmakar

You think the government taxes you too much? In Nagaland even the air you breathe is taxed. And finally people are beginning to resist this.

Like their counterparts in other sixth schedule (the part of the Constitution dealing with tribal regions) areas, tribals of Nagaland are exempted from paying income tax. Unfortunately, they have too many governments to let them enjoy this exemption.

Several rebel groups — National Socialist Council of Nagaland (Isak-Muivah), NSCN (Khaplang), NSCN (Khole-Kitovi) and Naga National Council, to name a few — levy an array of “taxes” to run their respective “governments”. These are besides sales tax, professional tax and taxes by the state and central governments.

The rebels’ taxes are “revolutionary” indeed. They come under various unwritten heads such as “air tax”, “ration tax” and “health tax”. But the taxes, often revised, are broadly divided into four categories — income or royalty tax, contractors’ tax, house tax and trade tax.

All government and private sector employees pay 20-24% of their annual income as tax to each of the major groups. A contractor has to part with 5-10% of the cost of a project while every house owner pays Rs 500-5,000 per annum (Rs 250-1,000 in villages).

Trade tax depends on the size of a business. If pan or barber shop operators are taxed Rs 1,000 annually, major firms and business houses are taxed Rs 3-10 lakh. The rates of taxation are marginally higher for non-locals and non-tribal people, who are also issued identity cards — for seeking livelihood in Nagaland — by rebel groups for a fee. Some taxes are minimal; the “air tax”, for instance, is Rs 1 per head.

“There was a time when a couple of rebel groups would levy nominal charges periodically. But today, 10-12 groups come all the year round for this or that tax,” a Dimapur-based trader said.

According to social scientists in Nagaland, the scenario is changing with more Nagas taking to business. A rally against this last week was a case in point.

Though the Nagaland government has said it cannot let anybody impose illegal taxes on the people, it has often aired its helplessness. “It is for the Centre to do something as the rebels are talking directly to it,” state home minister G Kaito said some time ago.