Nov 20 2011

Eritrea: ‘A form of extortion’ - Eritrea’s 2% Diaspora tax.

‘A form of extortion’ – Eritrea’s 2% Diaspora tax

[From: A Week in the Horn Nov. 18, 2011 issue.]

As has frequently been noted, serious concern has been expressed that profits generated by the mining sector in Eritrea are being obtained by “slave labor”, and that this is being used exclusively in support of the regime’s continued efforts at regional destabilization. This is one reason why IGAD has unanimously called for an extended sanctions regime against Eritrea. The evidence has been provided in the detail of the reports of the UN Monitoring Group, and in the wealth of other evidence available to IGAD member states which have suffered from Eritrean activity.

Of course, concern has been raised about the humanitarian impact of a sanctions regime. This is a concern Ethiopia, in particular, shares. It is Eritrea’s neighbor, and it currently hosts over 60,000 refugees from Eritrea, more than 10,000 of whom are soldiers. Numbers are rising at the rate of over 12,000 a year, with as many more crossing into Sudan. It is worth remembering exactly why these people have chosen to take the difficult and dangerous step of turning their back on their own country and crossing a border which has been heavily mined to prevent people leaving and along which Eritrean border guards have shoot-to-kill orders. It might also be added that the government and people of Ethiopia take their responsibility to these refugees seriously. Indeed, despite Ethiopia’s own limited resources, a thousand of them are now attending Ethiopian universities on free scholarships.

Ethiopia would not do anything that exacerbates the problems of the people of Eritrea. That is why it has been pleased to note that any suggested sanctions regime should be carefully drawn up to target those individuals who are specifically responsible for the actions of the regime and reduce the financial means at their disposal while minimizing the impact on the population at large. Private remittances are, of course, as they should be, exempt from sanctions.

The 2% Diaspora income tax on Eritreans and foreign nationals of Eritrean origin living abroad, however, is another matter. This is demanded directly from Eritreans themselves and any money raised goes directly to provide additional resources for the “irregular financial practices” that the UN Monitoring Group identified as combining “with direct financial contributions from ruling party supporters and some foreign states” to explain why a country as poor as Eritrea manages to support so many armed opposition groups across the region. The money is usually channeled through embassies and consulates or government and party organizations. According to the United Nations, as quoted in the Canadian media, it may violate the Vienna Convention on Consular Relations as in areas where Eritrea has no diplomatic or consular representation, “the tax is often collected informally by party agents or community activists”, and their actions might in some circumstances be considered as “a form of extortion”.

Many Eritreans have made it clear they would agree. This tax is not of course voluntary and any Eritreans living abroad who wish to visit Eritrea, or to apply for an Eritrean passport, are expected to be able to demonstrate that they have fulfilled a number of requirements visibly demonstrating loyalty to the regime. One of these requirements is payment of the "tax" on earnings which is charged on all Eritreans working overseas. This was first levied by the EPLF during the independence struggle in the 1970s and 1980s, but it was clearly seen as too useful to stop when independence was achieved. The normal demand is for 2% but it has at times risen sharply, even reaching 10% as it did after May 1998 when Eritrea invaded Ethiopia and launched the 1998-2000 war.

The basic demand has always been for a flat rate contribution based upon the income from any source in the country of work and however obtained. For example, even those on income support or unemployment benefit in the country in which they live, are expected to contribute the required percentage. There are no exceptions. At times, people who failed to pay their ‘tax’ or the other ‘voluntary’ contributions required have been put under considerable pressure to make sure they contributed sufficiently. Letters are sent to defaulters to tell them how and where to contribute; pro-government community groups offer to send people round to “collect” the expected demonstration of loyalty. Reports from Canada, and other countries, in fact say “tax-collectors” visit people at home and note those who don’t pay. The information is sent to Asmara.

Eritrean embassies and consulates now provide a “Two per cent tax form” which provides spaces on which to list monthly and annual income going back to Eritrean independence or even earlier. There are columns to list the 2% tax payments and also for “Donations to national defense against Ethiopian invasion”. There is even a line to say “I confirm the above information is true with my signature. I understand giving wrong information is punishable by law”. The form also requires the name of the payee, of his father and of his grandfather.

The UN Monitoring Group Report notes that those who fail to pay may be refused passports or visas or denied entry into Eritrea despite their citizenship. There have been claims they may have property seized or find their family members living in Eritrea harassed. Recent media reports from Canada, quoting Eritreans living in Canada, confirmed these reports saying that those that fail to pay are “black-listed” by the government until they pay up. This can apparently mean more than a mere refusal to provide documentation. It can even mean that a family member is unable to access a bank account in Eritrea. There have even been reports that Eritrean expatriates visiting Eritrea have been prevented from leaving the country on grounds they have failed to pay the tax.     

This insistence on payment of the additional ‘tax’ is one aspect of the way the Eritrean government does not accept the concept of citizenship as a right for all Eritreans, even for those born in Eritrea. It is carefully selective in its acceptance of potential citizens, making a direct link between loyalty, as demonstrated by the payment of ‘tax’, or by party membership, and the provision of government services within the state. Having voted in the independence referendum in April 1993 and acquired a referendum ID card is another acceptable test of loyalty. This was never formally made a requirement for Eritrean citizenship, but in October 1994 when President Isaias issued a presidential directive revoking the citizenship rights of Jehovah’s Witnesses, he said they had “cancelled their nationality on their own volition by ‘refusing’ to participate in the referendum…".

There is, of course, no basis in international law to relate the provision of services for citizens in one country to the payment of tax on money earned and already taxed in another country. And as has been widely noted, not least by Eritreans themselves, the government’s treatment of its nationals in terms of paying national service conscript workers aptly deserves the phrase “slave labor”. This is not, of course, directly relevant to the central issue of Eritrea’s contempt of international law and of the international community in its continued activities of regional destabilization. Eritrea’s denials have not been accompanied by any evidence whatsoever of any change of policy. It is clear that strengthening the implementation of the previous United Nations Security Council Resolution, and imposing additional and concrete economic sanctions that deny the regime the resources to be able to continue with its destabilization and its support of terrorist activities are a necessary way forward. Failure to do so will certainly send the wrong signal that, when it comes to Eritrea, international norms of behavior somehow do not apply. That will be a travesty of justice. It will also be a slap in the face of people throughout the region, including the people of Eritrea who suffer most from the actions of their government.

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