May 24, 2003	Saturday	Rabi-ul-Awwal 21,1424

Please Visit our Sponsor (Ads open in separate window)

KABUL, May 23: Afghanistan’s government is looking to tap all national sources of revenue, not just customs duty, Finance Minster Ashraf Ghani said on Friday.

“Our effort is not confined to customs, in the north revenues from non-customs are higher than customs,” he told reporters.

“We intend to manage all the revenues of the country and not just the customs revenue. “Oil and gas and state-owned enterprises are very significant sources of revenue.”

Ghani said the government was also looking for new sources of revenue from taxes on telecommunications, mining and exploration for oil and gas.

“We have a revenue generation strategy on which we are working which is based on attraction of the private sector to really become the engine of growth,” he said.

The Afghan government is currently working with a group of 100 US lawyers to lay down the legal foundations for this, he said. After unifying the currency with the introduction of the new Afghani last year, Ghani said Kabul was now looking to shift the currency to a market exchange rate.

While he was looking at new taxes, Ghani said he would also eliminate arbritrary local taxes and ensure land tax was once again a national tax and not simply a form of extortion by armed men.

Provincial governors earlier this week agreed to hand over all their revenue to the cash-strapped central government after President Hamid Karzai threatened to resign if they did not obey.

OVERHAUL: He also unveiled a massive overhaul of provincial customs and finance directors on Friday, declaring Afghanistan was at the crossroads of either becoming a drug-funded or developmental state.

“Afghanistan is at a turning point, either we go towards a virtuous circle or a vicious circle,” he added.

“There are two choices: a narco-mafia state or a developmental state. We must work to make the developmental state happen because the possibility of a narco-mafia regime emerging here is still very real.”

Ghani is changing all heads of provincial customs and finance departments in a major overhaul to ensure Kabul receives revenues from recalcitrant governors.

“What I intend to do is to change all directors of customs and all directors of finance in all the provinces within the next month,” he said, adding most changes would be by rotation.

“We have to break the relationship where directors of finance think that they can be compelled by a governor not to remit revenue to the centre,” he said.

The government earlier this week decided to centralize collection of customs and other taxes. Governors of border provinces have been accused of withholding hundreds of millions of dollars earned from customs duty.

Provincial governors agreed this week to hand over their revenue. Any who refuse will be sacked, the minister said.

“There is an absolute consensus: 99.9 per cent of the country wants this and anyone who stands against these changes will be a pariah. No one will be able to resist this move because they know there is a national consensus on this,” he said.—AFP