Unofficial border crossing causes corruption, say local residents and small business owners

May 12, 2015

Local residents and small business owners in the Thai-Burma border town of Three Pagodas Pass have expressed frustration with excessive taxation levied in border regions by corrupt authorities, which they say results from the fact that the border point of Three Pagodas Pass remains an unofficial crossing.

Local business allege that the unofficial border crossing at Three Pagodas Pass enables border authorities to use their own discretion in charging taxes, both from people travelling and business transporting goods across the border. They explained, “When the border is unofficial like this, [border authorities] are not required to present their tax revenues [to higher authorities]. They can collect tax as they wish, which affects small businessmen like us. In total there are 27 tollgates run by different groups on the Three Pagodas Pass to Thanbyuzayat highway. Local people have to pay this unnecessary tax. There are no other countries that have this tax system”.

One local resident elaborated, “If this border remains unofficial, taxes levied by local government will continue. This tax collection does not go towards national finances, but goes to the corrupt border authorities. This tax issue is a big burden for passengers and local small business owners”.

43-year old petrol entrepreneur Ko Aung Win detailed that these high taxes are detrimental to local small businesses reliant on goods imports, making it difficult for them to turn a profit. He explained, “The tax on petrol is huge. We import petrol from Thailand. [Thai authorities] tax us 20,000 Baht, but on the Burma side [of the border] we have to pay nearly 30,000 Baht. We make very little profit. If we deduct our energy, time, and workers’ salaries, it is very difficult for us to make a profit. Likewise, trucks [transporting] beer and building materials are charged a lot [in the border area]”.

Every year residents of Three Pagodas Pass and local businessmen urge local authorities for an official opening of the border. This April during the Karen State Chief Minister visited Three Pagodas Pass to discuss regional border development, local trade and transportation, local residents and entrepreneurs urged to find a way to resolve Three Pagoda’s Pass’ tax issues. However, state authorities have consistently given excuses and delayed plans to create an official border crossing.

“The tax they collect is shared between local and State authorities,” said Ko Aung Win, “State authorities are involved in this corruption. That is why they ignore people’s wishes to open the border officially”.

According to local businessmen, “It’s time to open the border officially. Then local trading will improve. As we are residents of this border town, we can learn from our neighbour [Thailand]; how systematic their tax system is, how well managed their tax system is, how transparent it is, and how they manage to spend [taxes] effectively on regional development. For us, we pay a lot of taxes but the taxpayers don’t know anything about how much has been collected and who is managing it. The worst part is that we don’t see any signs that the tax is being spent on regional development. It looks like there is big corruption. If this [corruption] is allowed to happen, we will not see development in this region. The regional authorities need to agree to resolve this problem”.

Written by HURFOM · Filed Under News