By: Staff Writer

Colombo (LNW): Sri Lanka’s tax burden is shouldered by those who can most afford it and the tax structure focuses on a few core taxes (personal and corporate income tax, VAT, core excises) says Finance Ministry secretary Mahinda Siriwardena.

Addressing the Inaugural Convocation of Chartered Institute of Taxation of Sri Lanka Mr Siriwardena noted that tax exemptions are eliminated as far as possible to ensure that taxes are neutral between sectors and entities and distortions are limited.

The initial focus of the tax reforms was on optimising tax revenue from progressive direct taxes such as personal and corporate income taxes.

There has been strong public opinion regarding the personal income taxes in particular. Sri Lanka collects around 0.5% of GDP from personal income taxes (PIT) whereas regional peers collect around 2% of GDP from PIT, he claimed.

The PIT structure was designed on a scientific basis considering the official income and expenditure survey (with estimates adjusted for inflation up to the point of implementation).

Accordingly, only the top 20% of Sri Lankan income earners are liable for income tax at a tax-free threshold of Rs. 100,000 per month.

Illustrating further, he added that the median income earner of the 10th highest income decile, would pay 5.8% of his or her total monthly income as tax,.

The Government is fully cognisant of the difficulties that are faced by tax payers given the increase in PIT rates and narrow tax slabs.

However, this is a crucial and essential contribution of the relatively high income-earners of the country towards the resolution of the economic crisis.

Finance Ministry is also fully aware of the various proposals presented to reduce PIT rates and still collect Rs. 100 billion from personal income taxes.

However, any reduction in PIT rates or threshold adjustments will result in lower Government revenue, which creates a shortfall from the target of 15% by 2025.

This will mean some other tax will have to be increased to compensate for the lower PIT – and this wm he said.

However, once tax administration and compliance measures take full effect and revenue targets can be met, it will be possible to adjust tax rates, he pointed out.

Sri Lanka has an ambitious and challenging target of reaching a revenue to GDP ratio of 15% by 2025.

This is a crucial requirement in terms of meeting the primary balance target, which in turn is a critical element of the debt sustainability target for the country.

Meeting these targets is necessary to stay on course with the IMF supported program and debt restructuring, which are essential components of Sri Lanka’s economic recovery.

Colombo (LNW): An island-wide operation targeting drug traffickers and organised crime, initiated on Sunday, resulted in the apprehension of 2,166 individuals, including 88 women, within the past 24 hours, according to the Public Security Ministry.

A total of 2,210 raids were conducted during this period, with more than 800 arrests occurring in the Western Province.

Of the apprehended suspects, 66 are under investigation with detention orders, while 169 are on the Police Narcotics Bureau’s IRC list.

Asset investigations have been initiated against 14 individuals, and 226 have been referred for rehabilitation.

Law enforcement authorities seized significant quantities of illicit substances during the operation, including 1 kg and 370 grams of heroin, 7 kilograms of cannabis, 556 grams of Ice narcotics, 3.5 kilograms of Mawa, and 1,075 narcotic pills.

The island-wide special operation, spanning 45 police divisions, began at 4 a.m. on Sunday and is scheduled to continue until December 23.

It involves collaborative efforts from the Police, Special Task Force (STF), and the armed forces, with a primary focus on combating drug trafficking and organised crime.

Colombo (LNW): The Court of Appeal was informed by the Attorney General yesterday (18) that the Criminal Investigation Department (CID) had acted irregularly in its investigation of money laundering allegations against Pastor Jerome Fernando, who is accused of defaming Buddhism and other religions.

The revelation came during the hearing of a Writ application filed by Pastor Fernando challenging the Colombo Fort Magistrate’s Order for his remand pending investigations into charges of violating the conditions of the International Covenant on Civil and Political Rights (ICCPR) Act.

The Court of Appeal reserved its order for December 20 on the Writ application. During the hearing before Justice D. N. Samarakoon, Senior State Counsel Shaminda Wickrema, representing the Attorney General, argued that the application should be dismissed without delving into its merits.

He raised several Preliminary Objections, including the filing of the writ petition on December 14 for a hearing on December 18, without allowing the mandatory time of at least three working days for the Respondents to prepare.

Wickrema also alleged that necessary parties, especially the Intervenient Petitioners, were not named in the Petition.

Emphasising that the petitioner is not a privileged suitor and urging the court not to allow Jerome Fernando to desecrate the “Temple of Justice,” Senior State Counsel Wickrema urged the dismissal of the application.

Counsel Lakmini Warusawithana, representing the Intervenient Petitioners, supported the Preliminary Objections and stated that they were not made parties and had not received notice until the morning of the hearing.

She reiterated that the petitioner engaged in forum shopping and expressed the intention to file objections if the court proceeded with the case.

Warusawithana emphasised that the petitioner had suppressed material facts, particularly regarding other cases filed by him, which are pertinent to the present application.

Responding to the objections, President’s Counsel Ronald Perera, representing the petitioner, argued that there was no forum shopping, the petitioner’s statement did not violate the ICCPR, he did not abscond, and the petitioner was not charged with money laundering.

Colombo (LNW): Janaka Dharmakeerthi, Secretary of the Agriculture Ministry, has been designated as the new Chairman of MILCO Company Limited, as announced by Agriculture Minister Mahinda Amaraweera.

In addition to his existing role as the Secretary to the Ministry of Agriculture and Plantation Industry, Dharmakeerthi has been entrusted with the responsibilities of this chairmanship. The appointment is effective from December 18.

Dharmakeerthi’s appointment comes in following the resignation of his predecessor Renuka Perera.

The decision to appoint Dharmakeerthi as the new chairman is motivated by concerns over rising employee dissatisfaction within the company and a decline in MILCO Company’s production productivity.

The former Chairman, Perera, resigned from the position in protest against the proposed sale of MILCO (Pvt) Ltd to an Indian company.

1. Presidential Election 2024 hots up with UNP expressing confidence of continuity, amidst reports of business leader & MP Dhammika Perera being the SLPP candidate: Perera is a businessman with significant domestic & international investments, who has also held Govt positions as Secretary of Ministry of Transport and as Minister of Investment Promotion.
   
2. Economic “expert” & Govt Advisor Dr Shantha Devarajan who was one of the chief advocates of the “debt default” & IMF programme, says the property of the rich is largely untaxed and therefore a “property tax” would serve to raise tax revenues without hurting the poor.
   
3. Reports emerge that SLPP Founder Basil Rajapaksa has left for Los Angeles, USA: SLPP has so far not made a reappointment for the position of National Organizer.
   
4. Last rites of Captain Ranish Hewage who was killed in Ukraine, performed in Milithon, Ukraine, amidst the salutes of the Ukrainian military & tributes of Ukrainian people: Ranish named as a hero who gave his life to protect Ukraine: Ukrainians get down from vehicles & pay respects, even while snow was falling on the path when the body was being carried.
   
5. Urban Development & Housing Minister Prasanna Ranatunga directs the National Housing Development Authority to initiate an investigation into the housing projects conducted by SJB leader Sajith Premadasa during his tenure as the Housing Minister of the Yahapalana Govt (2015-2019): alleges the then Deputy Leader of the UNP had distributed housing loans, etc., in violation of proper procedures.
   
6. Kilmisha Yaazhisai from Jaffna emerges the Winner in the Grand Finale of Indian TV channel Zee Tamil’s “Sa Re Ga Ma Pa” – Little Champs (Season 3) in India: “Sa Re Ga Ma Pa” is a popular song show in the Tamil TV industry, with a dedicated fan base.
   
7. Sectoral Oversight Committee on Children, Women & Gender Relations recommends re-enforcing the law that prevents mothers with children under the age of 5 years, from leaving for foreign employment.
   
8. Public Security Minister Tiran Alles says certain lawyers who opposed the appointment of Deshabandu Tennakoon as the Acting IGP, are appearing on behalf of notorious drug traffickers against whom cases have been filed in Court: also says these lawyers are earning billions of rupees from such cases: asserts he & the Acting IGP are committed to cracking down on narcotic drugs & the underworld, irrespective of objections & pressures.
   
9. Anuradha Tennakoon, President of the National Agrarian Unity says the adverse impact of VAT from 1st Jan’24 will be felt in a range of industries as well as the people: laments the price of a 50kg bag of chemical fertiliser would increase from Rs.8,500 to Rs.10,000 while the cost of a “Bhoothaya machine” would increase from Rs.7.8mn to Rs.8.5mn.
   
10. Program Manager, World University Services of Canada Michelle Joseph says Internet penetration in SL has accelerated from 30% in 2022 to 66% now: also says that as a result of this access, the female workforce could increase by over 8% by 2028.

Colombo (LNW): Minister of Labour and Foreign Employment, Manusha Nanayakkara, has announced plans to open a Sri Lanka Bureau of Foreign Employment (SLBFE) branch in Nuwara Eliya in response to requests from the children of expatriate workers.

This office, set to open in the first week of the upcoming year, will provide services in Tamil.

During an event marking International Migrants Day, the Minister emphasised SLBFE’s commitment to efficient service in citizens’ native languages.

Minister Nanayakkara addressed concerns raised by Nuwara Eliya residents who face challenges traveling to distant locations for issue resolution due to officials’ lack of Tamil fluency. In response, he pledged the establishment of the Nuwara Eliya SLBFE office within seven days of January next year, staffed with Tamil-speaking officers.

The Minister highlighted the vital role of migrant workers in contributing US $8.1 billion to the country’s economy over his 19-month tenure. He addressed challenges faced by expatriate workers during the COVID-19 pandemic, emphasising the government’s efforts to improve their treatment, including initiatives like the Hope Gate at the airport.

While celebrating the success of a recent campaign urging expatriate workers to contribute to the nation, Nanayakkara expressed disappointment at the subsequent neglect of their contributions.

He addressed critiques against providing special privileges to foreign workers, emphasising the government’s commitment to overcoming challenges and building a robust system.

The Minister discussed issues related to expatriate workers, such as bureaucratic delays in implementing tax relief for electric vehicles and challenges in regulating foreign employment practices.

He highlighted actions taken against agencies engaging in malpractices and underscored the need to dispel misinformation about foreign employment expenses. The Minister also encouraged reporting instances of financial exploitation, assuring protection.

Airport programmes aimed at preventing individuals from traveling for foreign employment on visit visas were mentioned, along with amendments to the SLBFE Act to curtail illegal activities. The Minister outlined plans to extend privileges to expatriate workers, potentially allowing them to become SLBFE Board members.