The boom in the export business, with the export of boulder at one time becoming the number one export item, even if briefly, caused a rumble in the trucking business. Everybody wanted to buy trucks. Truck drivers quit jobs to own and drive their own, banks dished out loans and traders brought in bigger and better trucks.

Trucking business peaked in 2018 with imports worth Nu 1.91 billion. In the private sector, some were measuring their progress by the number of trucks they owned or have in the boulder business.

It was to hit a speedbump. And it did. Despite the controversies surrounding the boulder business, the external factors that nearly killed the business and the pandemic, something was going awry in the business.

The anti-graft commission has brought two private companies under its scanner for alleged tax evasion. This is drawing attention as the alleged amount is huge because of the sheer volume of trading. Tax evasion is a crime, but not a big surprise even if the two are convicted. It has become a part of business. Everybody wants to pay the minimum tax if not evade altogether. Therefore, at the end of the year, many hire “consultants” to do the paperwork – all with the intention to retain as much profit and pay as little as they can to the government coffer.

Evading tax, it is said, started with the introduction of the tax system. Even before a formal tax system was introduced, evading it was the norm whether it is the amount of soot you were supposed to collect for making ink or the hide that you had to pay to the dzongs to make glue. Those with connections or the means to evade could pay one kilogram less hide or one phita (a measuring can) less of soot.

In other words, the systems, even if established, had loopholes or were not watertight to prevent evasion – in today’s contest, revenue leakage. A landlord can manipulate house rents at the time of paying personal income tax, small businesses empty their shelves to indicate a bad business (to evade tax) and big businesses come to the tax office in flashy prados and land cruisers to declare a loss, year after year.

Two companies are suspected to have evaded tax. But looking deeper, it was the loopholes that had to be blamed. Green tax is mandated by the law. It is 10 percent, and bigger the vehicle, in this case, 10-wheeler or more and the volume of import, it could be difficult to escape the notice of the tax office. From the layman’s understanding, dealers or buyers cannot escape without paying that. How it happened will be out after the ACC investigation. 

ACC investigating tax evasion, many aware of the boulder business, say is just the tip of the boulder! If we dig deep, many say is the cause of the mounting non-performing loans financial institutions are faced with.

The Covid-pandemic has come as the saviour as it made the scapegoat for NPL. The seized trucks parked with grass growing underneath the tyres could reveal another story. Many say the trucks even if auctioned off would not recover 50 percent of the loan. There were tricks up the sleeves. One was hiking the cost for loan purposes. If a truck costing Nu 2M was reflected as Nu 4M (on paper) and banks gave 50 percent of the loan, it is 100 percent loan. 

If the loopholes are plugged,  ascertaining the cost of a truck is no hard job.