Taxation Disputes

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Browsing Taxation Disputes by Author "Assad Kamel Mustafa Musa"

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    Customs Evasion and its Impact on Palestinian Customs Revenues
    (2005) Assad Kamel Mustafa Musa; Dr. Mohammed A. Sharaqa
    Customs evasion is one of the problems and obstacles precluding the government’s performance of its job: securing welfare and providing basic services to its citizens. To these two end, governments largely depend on customs given their significant contribution to the treasury coffers with the badly needed funds. Customs proceeds are considered one major resource for the treasury which governments cannot survive without. Customs evasion, in the Palestinian Territories, is one of the important factors behind the severe shortage which the Palestinian treasury suffers from. Customs revenues mainly come from trade with or through the Israeli side. It was found that 77% of Palestinian total foreign trade was with Israel. This high percentage is due to the extraordinary circumstances in the region. The difficult political conditions have made Palestinian foreign trade different from those of other countries. Palestinian economy and people are held hostage to the Israeli military occupation measures on the ground: prolonged closures, roadblocks, curfews, restriction on travel and control of border crossings. All these measures combined have led to an increase in customs evasion. In addition, the customs laws, effective in the Palestinian Territories, have some gaps or shortcomings and as a result, customs payers evade paying customs duties. The unfair economic agreements signed between Palestine Liberation Organization (PLO) and Israel have also had their heavy toll on the Palestinian treasury. This study aimed at identifying the Palestinian National Authority’s revenues, percentage of customs’ contribution to the public budget, sources of public revenues. By learning about the nature of the Palestinian customs and its evasion, in terms of organization, specializations and procedures, the researcher sought to examine the customs evasion phenomenon in terms of its types, pillars and penalties applied on customs evaders. This was in addition to the reasons behind customs evasion. The researcher also examined the international economic agreements, including GATT and Paris Economic Protocols (between the PNA and Israel), to find out their impact on customs revenues. He also focused, in his study, on how to check on the customs evasion phenomenon. To these ends, he depended on references, sources, documents and other primary materials such as the texts of the agreements signed between the PLO and other countries. In addition, the researcher managed to have access to directives, and guidelines issued by he Ministry of Finance. After data collection and analysis, it was found that the economic reasons played an important and effective role in increasing customs evasion. In addition, it was found that a number of moral, social and political factors were responsible for the rise in customs evasion cases. Further, the penalties, enforced by the Palestinian National Authority, played a leading role in increasing customs evasion. Besides, the laws enforced played a significant and effective role in increasing this phenomenon. Also the absence of a modern and updated Palestinian Customs Law is contributing to the spread of evasion from paying customs. To check on customs evasion, in the Palestinian Territories, the researcher recommends the following: 1. Enacting a new Palestinian customs law. 2. Training customs cadres to check on the customs evasion. 3. Setting up customs courts, in the Palestinian Territories, to settle customs disputes. This is in addition to developing the customs judicial apparatus. 4. Enhancing the role of both internal and external control of offices’ performance and evaluating/ assessing their effectiveness. 5. Toughening penalties on customs evaders. 6. Reformulating and renegotiating the agreements, including Paris Economic Protocols, signed by the PLO and Israel.