“The revenue generation from fine income into the state budget is one part of the revenue generation from income of non-taxation and the plan for revenue generation from fine incomes is processed by Ministry of Finance,” S. Oyuntuya, a Lawyer of the Women for Social Progress Movement told MonInfo on Wednesday.

“Our organization made an analyses and monitoring report of the revenue generation from fine income over the last five years of reports of state budget for three provinces, six soums and one district of Ulaanbaatar,” Oyuntuya said.

“One discrepancy that attracted our interest was that this income rate is always realized 100-200 percent of the planned amount, which is increased almost every year.”   

Reports for provinces A and B showing revenue generation from fine income into the state budget; graph obtained from provincial budget reports due to the monitoring (amount in MNT):  

Under the monitoring the inspectors of the professional inspection, tax, fire and police agencies are to collect fines from people and organizations for this income. However researchers said that if employees couldn’t give out fines their salaries were reduced 20-40 percent. But if more fines are given than employees take a ten percent bonus from the amount of fines.

“The planning of the revenue generation from fine income into the state budget is not real because it is increased every year. The inspectors and police are under a lot of pressure to work from this plan, and they want just fine people any way possible. There is high pressure to develop the small and medium business in local areas. Thus the businessmen inform and keep a counterfeit record of taxes and such,” said Oyuntuya.    

“In fact the state organizations should assist people in order to help them make any irregularities which might be fined uncommon. Instead state inspectors and police are working just to give fines in order to fill their quotas,” noted Oyuntuya.

However officials at the regulatory body for collecting fines were unsure of how the planned amounts were chosen.

“The state budget is made under a plan; of course it is just like a family’s budget. It is stated in the state budget law also that fines are the duty of the Ministry of Finance. But it is different issue whether the planned amounts are correct or not,” B. Batjargal, Chairman of the State Budget Policy and Regulation Board of the Ministry of Finance told MonInfo on Thursday. 

“Maybe it is related to the measures with bonuses that when the planned amount increased more than the previous year the amount collected also increases. I’m not introducing this report, so I’m not sure,” Batjargal said.  

In a document with the conclusions of the monitoring the Women for Social Progress Movement stated that there are currently no mechanisms for controlling inspectors and policy makers who distribute fines and have no possibilities to control the revenue which is generated from fine income.

“This monitoring should be introduced to the citizens and our organization will send an official letter to parliament, the government and policy makers before December 1,” said one lawyer involved.