LTTE taxation burden on masses

by Ranga Jayasuriya

The LTTE's extortion and illegal tax has resulted in the cost-of-living sky rocketing in the Jaffna peninsula.

The ceasefire agreement does not have a clause forbidding the tax collection by the LTTE. Added to the high transport and payments for loading and unloading at entry-exit points on both sides of the boarder, the cost-of-living in the Jaffna peninsula is 25 per cent higher than the rest of the country.

This is despite the fact that a greater part of the country's poor live in the North-East, as underlined by the UNDP Millennium Development Goal report. LTTE is extorting an estimated Rs. 200 to Rs. 300 million every month from Jaffna bound cargo passing from its entry-exit point in Pallai.

The estimated illegal tax revenue for the LTTE from the goods sent to Jaffna through the Alpha nine road from June 1 to 19 is Rs. 65,721,821, according to intelligence reports.

The LTTE earned Rs. 285 million from goods for bound Jaffna during March on the festive eve of the Sinhala Tamil new year.

These figures are based on well substantiated intelligence reports.

LTTE tax rates vary from five to fifteen percent depending on the item. Infant milk powders are not taxed.

The LTTE also holds the monopoly in wholesale business in the Wanni through three companies owned by the LTTE and based in Kilinochchi.

These companies, Seran, Pandiyan and Selan are believed to have earned Rs. 175 million revenue from the wholesale business and hospitality trade.

Seran owns rice mills and is involved in wholesale trade of rice. Selan is involved in hardware and building materials business, while Pandiyan runs the restaurant and bakery trade in the Wanni.