Surcharge tax bill: Government's new 'Abracadabra' for generating funds

by Amani Nilar 22-02-2022 | 8:20 PM

COLOMBO (News 1st); The draft bill which proposes a tax of 25% on the EPF, ETF, companies, partnerships and individuals who have earned a profit of more than 2 billion rupees for the 2020/21 financial year was tabled in Parliament on 22nd February.

Titled the Surcharge Tax bill, the Finance Minister Basil Rajapaksa previously assured that the Employees funds will be exempt from this tax, this amendment had not been included in the draft that was tabled.

When the Chief Organizer of the Opposition, Lakshman Kiriella asked the Leader of the House, Dinesh Gunawardena about the EPF and ETF funds being exempted from the bill, Minister Gunawardena stated that the Finance Minister did indeed maKe such a statement, to which SJB MP Harsha de Silva responded stating that it is pointless if statements are made for the sake of it, as only the Parliament has the power to change the law.

He further stated that although the CBSL Governor Cabraal assures that economical issues will be solved, the reality is different.

Speaking further, the MP said that the foreign reserves which stood at 7.8 billion USD dropped to 2.3 billion USD by January, out of which 1.6 billion is Yuan, therefore invalid. Which , results in Sri Lanka having only 700 million USD in hand.

Further citing reports of Sri Lanka's foreign remittances being reduced by 30%, 40% and 50% subsequently, ever since August last year, MP de Silva pointed out that in December last year, it was reduced by 60%.

Moreover, he highlighted the Bloomberg interview in which the CBSL Governor Cabraal stated that he expects to sell the assets of the country through Selendiva and generate 1 billion USD during the past 6 months, which have not materialized.

"Although in November 2020 the SJB pointed out that going to IMF would solve these accumulated issues, now we don't believe that we can solve this issue by getting only IMF assistance. It is only if the debt is sustainable that the IMF will help us without restructuring our debt. If the debt is not sustainable we cannot come out of this mess by just going to the IMF. The loans will have to be restructured," he added.