The government which inherited a massive debt burden from the Rajapaksa regime, would have to pay Rs. 1.9 trillion this year as loan repayments of which 83% being loans obtained prior to 2015. Yet, we have taken on this burden and are moving forward, while not placing too much of a burden on the people, said Finance and Media Minister Mangala Samaraweera.
“In a country with a population of 21 million, there were only 400,000 tax files opened, but after we brought in the new Tax Bill, many tax payers have come forward voluntarily to pay even a small percentage of taxes. By last Wednesday, 69,000 new tax files had been opened. If we continue this momentum, by 2020, we would be able to reduce the VAT by 2.5%. The government has taken measures to streamline the domestic income, which would take the country’s economy forward, while providing concessions to the people, said Minister Samaraweera.
He said so in Parliament yesterday, commencing the debate and presenting two notifications under the Excise Ordinance. Under this ordinance, the Finance Ministry had agreed to reduce the taxes on the bottling of toddy with the aim of implementing measures to monitor the toddy industry.
According, to Samaraweera, from 2019 to 2020, it would be the most difficult period, as some of the loans would reach maturity and the country would have to pay over Rs. 4 trillion.
“Yet, with all that burden, we have managed these loans during the government’s 100 day programme, we increased the government servants salaries by Rs. 10,000. Despite having to increase fuel prices, it was still under what the previous government provided. After three years, there had only been a small increase in the prices of essential commodities. Yet, it is only coconut prices that we were unable to control. For those who question our government as to what we had done for the country, I would wish to say we have done our utmost for the country, especially in the health sector, the government has done a commendable service.
Today, we provide hear patients with stents absolutely free of charge. Cancer patients are provided treatment for as long as they require it, without limitations for their cancer treatment, etc. Ironically, although the people know how much we have done, they are reluctant to admit it,” he said.
The Minister noted that as a result of many requests made, the government has decided to exempt the withholding tax on children’s accounts which earlier stood at 5%.
“During the previous regime, the 2.5% withholding tax was charged on these minor’s accounts. However, we increased it to 5%, but having paid heed to the numerous requests to exempt accounts of minors under 18, we have taken the decision to remove the withholding tax on these accounts completely.”
“However, we admit that there were certain clauses in the Inland Revenue Bill brought in April and have made several amendments. The royalty fees charged by artistes was also taxed and we have brought in a new amendment to exempt the tax on royalties earned up to Rs. 50,000 monthly. Only income from royalties above this amount would be taxed.
Further, the channelling service tax and taxes imposed for services obtained from private hospitals, except room charges, would also be exempted from tax, as we had realised that due to the congestion at government hospitals, many patients seek treatment at private hospitals.
Therefore, as a sensitive government, we have identified certain shortfalls in the Inland Revenue Act and further amendments would be made and several others would be included and an amendment to the current Act too would be presented to Parliament during the first week of July,” he added.
VAT Amendments to be presented in July
A series of Amendments to rectify the identified loopholes of the newly introduced Inland Revenue Bill will be presented in Parliament in the first week of July, Finance and Mass Media Minister Mangala Samaraweera said.
Speaking in Parliament yesterday he said the removal of 15 percent VAT on channelling at private hospitals, exemption of all savings accounts of children less than 18 from income tax and exemption of royalty payments upto Rs 50,000 per month from income tax are included in these amendments.
He said these amendments have already received Cabinet approval.“We have already informed our officers not to charge these taxes, as we hope to pass the amendments soon,” he added.
He said artistes who earn more than Rs 50,000 per month from royalty payments would still have to pay the income tax. He said 15 percent VAT will continue for those who obtain residential treatment in private hospitals.
The new Inland Revenue Act came into operation from April 1.It introduced a new income tax structure to raise state revenue by closing existing loopholes in revenue collection.
Severe shortage of AL Maths, Science graduate teachers: Minister proposes special allowance to attract more
Education Minister Akila Viraj Kariyawasam said there is a severe shortage of qualified teachers in the GCE Advanced Level Science and Mathematics streams in the entire country because the majority of degree holders who specialised in such subjects do not apply for teaching vacancies.
To address this issue, he said he hopes to present a Cabinet paper in the near future proposing granting a special allowance for teachers who teach Science and Mathematics subjects to attract more degree holders to fill the teacher shortage.
JVP MP Nihal Galappaththi brought it to the notice of the Minister that there are no teachers in the Zahira College, Hambantota which is the only Tamil medium national school in the district to teach Advanced Level Science and Mathematics streams at the moment.
In response, Kariyawasam said, “there is a severe shortage of qualified teachers for Advanced level science and mathematics subjects, both in Sinhala and Tamil mediums. I hope to present a Cabinet paper to propose granting an allowance to Advanced Level science and mathematics teachers in addition to their salaries so we would be able to attract more degree holders for the remaining vacancies”.
Adjournment debate on PC elections on July 6: Debate on Sri Lanka-Singapore FTA on July 18
Dissenting views had been expressed at the Party Leaders’ Meeting yesterday on the electoral system to be adopted for the Provincial Council Elections.
Considering the different views, Speaker Karu Jayasuriya has proposed to hold a full day adjournment debate on PC Elections on July 6 and it has agreed by the party leaders.
Parliamentary sources said Local Government and Provincial Councils Minister Faiszer Musthapha had informed Party Leaders that the President is of the view that the PC elections must be conducted under the new electoral system, which is a hybrid of First Past the Post system and the Proportional Representation system.
However, Minister Rauf Hakeem had objected stating that the minority parties could not agree to it. They had preferred the old electoral system with preferential votes.The meeting had ended inconclusively.
Meanwhile, the Joint Opposition has sought an adjournment debate on Sri Lanka-Singapore Free Trade Agreement. Following the request of JO Parliamentary Group Leader Dinesh Gunawardena, the Party Leaders have agreed to take up the said debate on July 18.
State Ministers Harsha, Eran berate TNA MP: Government does not discriminate against North and East
State Ministers Dr. Harsha de Silva and Eran Wickremaratne roundly criticised TNA MP S.Sritharan for not having the courtesy to appreciate the many positive work being undertaken by the Government in the North.
MP Sritharan was highly critical of the Government in his speech stating that the needs of Tamil people in the North were being overlooked and that they were being treated as second class citizens. He said a referendum must be held for people in the North and the East asking as to whether they would like to continue to live together with the people in the South.
He said the lands in the area were held by the military. Joining in the debate on 1990 Suwaseriya Foundation Bill, MP Sritharan was critical that the people in the North have more burning problems to be resolved than having an ambulance service.
At this point State Minister Dr. de Silva said, “You criticise, we listen. A lot of what you said was not accurate. You know the Army is gradually returning the lands of the people. This is a fact.
You did not have the courtesy to appreciate it. Before the end of next month, 1,061,315 million people in the North will receive pre-hospital care ambulance services and emergency response services free as we extend ‘Suwaseriya’ to the North. Before the end of this year we will extend this service to the East as well.”
“If you do not want it to the North tell us, we will take it back,” said the seemingly miffed State Minister.
State Minister Eran Wickremaratne, who took the floor after MP Sritharan, said the Government at no point discriminated the Northern Province from the rest of the country.
“We cannot solve all the problems of the people in the North at once, and neither we can solve all the problems of the people in the South at once. The Finance Minister held discussions with the military Heads even this week to release more lands in the North.
The Government has given high priority for the reconciliation programme. The Government cares not only about the Northern Tamils, but also about the Tamils and other minority groups in the South.
I disagree with Dr. Harsha de Silva for asking MP Sritharan as to whether they want the Suwaseriya service to the North. We should deliver and serve all our citizens equally and MP Sritharan’s stance should not matter in implementing the state policy,” he commented.