Wednesday, February 22, 2017

Fixing Africa. The whole shebang including health.

African governments aren't taxing the rich. Why they should

Rhiannon McCluskey, International Centre for Tax and Development

A great deal of attention has been paid to the obstacles African governments face in effectively taxing the profits of transnational corporations. African governments are frequently urged to widen their tax bases by reducing tax incentives for foreign investors. But what about Africa’s rich? Some Africans are very rich, and in many cases they are not paying their fair share of taxes.

The number of super rich on the continent is growing fast. According to New World Wealth, the number of high-net-worth individuals (people with assets over $1 million) in Africa rose at twice the pace of the rest of the world in the past 15 years. Its 2016 Africa Wealth Report states there are about 165,000 high-net-worth individuals in Africa, with combined wealth of $860 billion. More ultra high-net-worth individuals (with $30 million or more in assets) were created in Africa since 2003 than in any other region of the world. According to Wealth Insight, there are 1,932 in Africa.

But it is challenging for African governments to tax the wealthy.

Why collection is so hard

One of the reasons is the challenge of taxing income in economies that are highly informal. In Organisation for Economic Cooperation and Development countries, personal income taxes make up about a quarter of all tax revenue collected. In Africa, they only make up about a tenth on average, and as little as 4% in countries like Uganda and Rwanda. This is primarily – up to 95% – collected from employees of formal businesses through the pay-as-you-earn system. Self-employed professionals generally evade taxes and formal employees often engage in informal business on the side.

This informality contributes to African tax administrations lacking information on which citizens are high-net-worth individuals. In Kenya, only 100 high-net-worth individuals of a likely 40,000 are registered with the tax authority. In South Africa, up to 114,000 high-net-worth individuals are unregistered, costing the government about $10.9 billion in tax revenue.

It is also hard for African governments to tax the rich because they hide their wealth using the offshore financial system. Gabriel Zucman, from the London School of Economics, estimates that 30% of all African financial wealth is held offshore, amounting to about $500 billion. This means African governments are losing out on roughly $15 billion in taxes from individuals annually, and this does not take into account non-financial wealth. In 2015, Swiss Leaks revealed that HSBC Switzerland alone held more than $6.5 billion for clients from sub-Saharan Africa.

Uganda as a case study

A recent study undertaken by the Uganda Revenue Authority with support from the International Centre for Tax and Development, revealed the extent to which the political and economic elite evade taxation in Uganda.

The researchers examined lawyers from top commercial law firms and found that out of a group of 60, only 12 had paid personal income tax in 2012, and only 13 did the following year. The team also investigated individuals who paid large import duties. They found that although 12 people paid more than $180,000 in customs duties in 2014, none of them had paid personal income tax.

The researchers also investigated the links between government officials, business and tax compliance. Looking at a group of 71 high-ranking government officials owning large business assets (like hotels, schools and media houses), they found that only one had ever paid personal income tax between 2011 and 2014. Further, the companies the officials were associated with were largely non-compliant, with 47 out of 56 not paying any corporate income tax in 2013.

Political challenges

Increasing tax compliance among the wealthy is challenging because economic elites have great political influence. They are also often members of the political elite. In Kenya, for example, the government tried to implement a capital gains tax on the sale of property and shares, but was forced to scrap it due to resistance from business.

Uganda tried to introduce a system requiring income tax clearance from people buying land valued over $18,000 in 2011. This was also stopped due to political pressure.

Still, great progress is possible. Spurred by the results of the study mentioned above, the Uganda Revenue Authority established a high-net-worth individual unit in September. The new unit has been a significant success, raising an impressive $3.3 million in revenue by February.

Although enforcing tax compliance among the rich can generate significant additional revenue, what is at stake is much greater. The injustice of those with the most money not contributing to the public purse erodes the legitimacy of the whole system, leading those with less to feel even less willing to comply. As Ugandan researcher Ronald Waiswa said:

If you let the big crocodiles swim freely, the small fish will follow.

The Conversation

Rhiannon McCluskey, Researcher Officer, International Centre for Tax and Development

This article was originally published on The Conversation. Read the original article.

Saturday, April 2, 2016

One of the quietest and best public health achievements I have come across. Guinea worms OUT!

Thank you Jimmy Carter and Motherboard.

Monday, December 8, 2014

"Toxins" don't exist

As I've been telling anyone who will stick around long enough for decades YOU CANNOT DETOX YOUR BODY!

Human bodies have evolved to de-toxify themselves, mainly via the liver and kidneys. There are substances which are truly toxic to some individuals, or for all of us, but we don't tend to have "de-toxifying" regimes thrust on us for those. For people with Wilson's disease the toxic substance is Copper and for the rest of us it can be excess headache tablets in the form of paracetamol/acetominophen. As that reference tells you, even a small overdose can be fatal! As a freely available over-the-counter medicine in most countries, we should give the community Public Health reminders about Paracetamol's easy toxicity.

Finally, a prominent and popular newspaper has made a headline out of it. You could do worse than reading this article from the Guardian. [Copyright rests with The Guardian].

You can’t detox your body. It’s a myth. So how do you get healthy?

Saturday, July 10, 2010

I'm starting to get worried!

Here comes the good old Lancet with the latest look at risk factors for stroke, worldwide:
Risk factors for ischaemic and intracerebral haemorrhagic stroke in 22 countries (the INTERSTROKE study): a case-control study by Martin J O'Donnell & multiple colleagues. [If you create an identity and password you have access to this article even if you don't subscribe].
Although I wish they'd come up with something different, the verdict was:

"Phase 1 of INTERSTROKE suggests that hypertension, smoking, abdominal obesity, physical inactivity, and diet are the most important modifiable risk factors for stroke. These important findings should help to inform stroke prevention strategies around the world and to reduce the global burden of stroke." (Comment: Reducing the global burden of stroke: INTERSTROKE by Jack V Tu, The Lancet, Volume 376, Issue 9735, Pages 74 - 75, 10 July 2010)

Yeah sure mate- "help inform stroke prevention strategies"- I think most moderately health-conscious societies are quite well informed on this already- but how the hell do you get us (the at risk people right now) to exercise against that awful, ingrained "physical inactivity". We are NOT MOTIVATED YET!! I think someone has to come up with something new to get us all off our bums!

Quite honestly, I have been exhorting myself to exercise regularly since the age of 15 when my family doctor handed me the old XBX exercise paperback and said "Start here!". For no more than 14 days of my life have I exercised vigorously EVERY DAY- and that's when I have gone on holidays specifically to walk at least 10km/day over someone else's hills! I have plenty of photos to prove it, too!
Here I am at the famous Beseggen Ridge in Norway in mid 2004, a cardiovascular treat if ever there was one!

I see absolutely nothing in my neighbourhood, which is full of middle aged and older citizens, prominently encouraging us to come along to exercise sessions or enrol in a government-sponsored walking program. I have deliberately sought out suitable programs on the internet and discovered a Heart Foundation Walking Program, but I haven't managed to get along yet. There is also an early morning exercise class for "Seniors" at a local community centre, but it's at 7am and that is just dumb for most people who have blood pressure medication to take with breakfast!

At the other end of the spectrum, my neighbour has a 13 year old girl who rather fancies herself as Australia's answer to Paris Hilton (without the hotels, unfortunately), but I haven't seen her doing regular exercise around the neighbourhood, either. Isn't there a school health and fitness program to get these kids enjoying regular exercise as a normal part of their daily routine? Evidently not! This young lady HAS been attracted into a program where appearance is important- a cheerleading team- where some calisthenic moves are combined with a great deal of ribbon-waving and strutting around in glittery costumes! Are we missing something in the marketing department about what motivates regular exercise these days? Obviously, the promise of a glittery costume is not going to get me to the community centre at 7am any time soon, but I wonder what would?

I daresay I have quite a few risk factors for a stroke later in life:

1. I have had elevated blood pressure all my life, even during childhood.
2. Both my parents had high blood pressure- mum from her 50s, dad from his 70s.
3. I'm on some medication for another problem which actually CAUSES elevated blood pressure, but I have no alternative at the moment.
4. My mum started having mini-strokes/TIAs [transient ischaemic attacks] from her late 60s and died as the result of a stroke during an unrelated operation at 81.
5. I am rather physically inactive, though not as much as most people my age who I know.
6. Although currently at the upper limit of normal weight for my height, my weight is concentrated around my middle.
7. I weigh 157% of my weight on leaving highschool!

OK- I have a few helpful factors going for me- I've been prescribed (and take) a pill for hypertension and it works moderately, but not all the way back to "normal"; I haven't used sodium salt sprinkled on food for nearly 40 years- we used to have a container of 50/50 sodium/potassium salt for me to use on potatoes (the only thing I liked a bit of salt on), but it took 10 years to use it up!; I eat a diet which others would regard as fairly healthy and I rarely eat anything prepackaged like sweet biscuits, frozen meals; I have never had artificial sweeteners as I thought they might be bad for my liver- I had weird ideas that they must be taking up a metabolic pathway that should have been utilised by another foodstuff, goodness knows what- and I figured if I didn't like an unsweetened version of something I could just give it up!; my diet is almost vegetarian but I believe I need animal meat because I am an animal born to utilise eaten muscle to maintain my own muscle; my diet is also rich in raw fruit and vegetables containing lots of anti oxidants, plus I eat raw, fresh nuts of various sorts for lunch every day- also a 30-year habit. The only cheese in the house is low-fat and I drink plenty of water and black tea, rarely coffee or soft drink. Lastly, my father lived to the age of 95, despite having a congenital heart valve problem, which did lead to heart failure in the end- but you'd hardly say he had the usual kind of cardiovascular disease!

SO!!! What will persuade me and others like me to exercise regularly? I know that when I went to aquarobics twice a week with friends, it was the social contact and the regular expectation that got me there. Now I don't earn a living and don't qualify for government assistance, paying $40/week to attend is out of the question. However, this would be a good way to go for people with a normal income. I still like my idea of having community fitness trainers/leaders who are paid out of the national health budget to get people into regular exercise programs to the extent of thumping on the front door and yelling at them to come out!

The National Heart Foundation walking program for seniors should be what I attend, as it's free (mainly), but I haven't managed to get there despite several tries! I haven't seen the new video publicising the walks on TV, either- where is it?? Since it's about dog-walking, it's not really for me, but might encourage plenty of others.

I keep returning to the research on depressed young people, where researchers found that regular exercise was quite therapeutic and wonder how this sort of program could be financed and monitored locally. It could be quite attractive to public health campaigners as it literally kills two birds with one stone! There is plenty of good research on psychological health and exercise for older people as well, even for those who already have heart disease!

Goodness knows why I'm still here, sitting on my proverbial and not out there treating myself to a dose of free depression treatment while lengthening my expected life span!