Islamic State issues fake tax receipts to keep trade flowing

09/03/2014 5:20 PM

09/04/2014 4:31 AM

The self-styled Islamic State has consolidated its control over much of the desert in eastern Syria and western Iraq by following a rule that’s governed in that austere region for a millennium: Don’t interfere with the ability of local Sunni Muslim tribes to make a living through trade.

Now that the Islamic State controls virtually all of central and northern Iraq, as well as most of eastern Syria and Iraq’s western Anbar province, it’s making sure nothing gets in the way of the ability of tribal businessmen continuing to make use of the main trade arteries that connect Jordan and Syria with Baghdad.

It’s also found a new source of revenue in the effort: tax collections on the goods, which range from bootleg gasoline to livestock and even consumer goods that stock Baghdad’s markets.

Not only does the Islamic State offer protection from bandits, but its tax collectors also provide traders with paperwork that shows they’ve paid Islamic State taxes as well as counterfeit government tax receipts that truckers can show to Iraqi army checkpoints, which allow them to pass without further payments.

The system is in place at the Waleed Crossing, which links Jordan to Iraq, and the Tanif Crossing, which links Iraq to the Syrian capital of Damascus as well as the Islamic State-controlled Syrian cities of Deir el Zour and Raqqa, according to truckers and merchants who described the process to McClatchy.

Their accounts of an efficient quasi-government structure fit with the portrait painted of the Islamic State as an organization with a businesslike penchant for record-keeping and systems that’s made it perhaps the wealthiest terrorist group the world has ever known.

Thaer Allawi, a long-haul trucker from Anbar province, said the Islamic State even had set up separate lanes for trucks carrying different types of cargo, with livestock and foodstuffs – Iraq imports much of its agricultural goods from Syria and Jordan – in one lane while another was reserved for electronics and appliances destined for sale in Baghdad’s growing shopping malls.

He described a trip from Jordan into Iraq in which his first stop was at an Iraqi army checkpoint before reaching an Islamic State checkpoint at the town of Ratba. It’s at Ratba, four miles down the road from the army checkpoint, that the Islamic State customs inspectors assess the value of the goods, collect the tax and issue an invoice.

“We take two copies of the invoice,” Allawi said. The first goes to the army at another checkpoint a few miles down the road. The second copy “we give to the merchant” who commissioned the trip.

The Iraqi army apparently accepts the receipt knowing full well that the taxes, invoiced on a fake government document, went instead to the Islamic State.

Since it declared a caliphate in late June in the area it controls _ a region as large as Jordan with a population of at least 6 million _ the Islamic State has felt comfortable increasing the taxes, from $300 for a load of foodstuffs and $400 for a load of electronics to a flat $800 per truck, said Mahmoud Murdi Hammad, 52, a driver from Ramadi, the capital of Anbar province.

“The Islamic State reaps thousands of dollars every day as a result of taxes from us truck drivers,” he said. “But to keep good relations with the tribes who control the routes, the Islamic State ensures the proper paperwork so the merchants pay the taxes, not us. We do not lose anything.”

The route remains precarious for Shiite Muslim drivers, whose religious beliefs are considered heretical by the Islamic State. Hammad said Islamic State militants often asked whether a shipment was headed to Iraq’s Shiite south and that Shiite drivers mostly had stopped driving the routes for fear of being identified and killed.

Those Shiites who continue to work, Hammad said, either carry fake identification cards, lie about the destination of the goods or offload cargo to Sunni drivers, who carry it through the militants’ checkpoints.

“It’s a sin to lie, but they are our friends and our loved ones, and we cannot see them in danger,” he said.

Jamal al Hatem, a member of the Dulaim tribe, one of the area’s most powerful clans, said the taxation system had become essential to commerce in the region. “Without this system of deception . . . all trade would collapse in Iraq,” he said.

And by keeping the tribes in the trucking business, even with the higher tariffs that are passed on to consumers in Baghdad and the south, the Islamic State is ensuring the loyalty of the tribal authorities in the region, at least for now.

“You cannot put your hand on the trucks of the Anbaris,” Hatem said. “Even in the time of Saddam, his men would not dare affect this trade. It is the lifeblood of the province, and stopping this trade would be the quickest way to send the tribes into war with the Islamic State, with the government, with anyone who tried to stop it.”

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