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NPP govt must talk to IMF about lowering taxes: Sajith
ECONOMYNEXT— National People’s Power (NPP) government must negotiate lower taxation with the International Monetary Fund (IMF), former opposition leader Sajith Premadasa said.
Speaking at an event, Premadasa said his party the Samagi Jana Balawegaya (SJB) will support the NPP government’s efforts to discuss a new arrangement with the IMF that will see taxes lowered.
“We always told IMF officials that we must enter a new agreement that is more concessional for the public. We campaigned for the presidential election on that foundation. We are watching to see when the present government will commence talks with the IMF again and enter a new agreement that will see the tax burden on the people relieved. We will support such a programme on behalf of the people,” he said.
“This new president and the government have a responsibility to discuss with the IMF and enter a new programme that will reduce the tax burden,” he added.
During the presidential election campaign, NPP leader Anura Kumara Dissanayake, who emerged victorious, had proposed that Sri Lanka’s income tax-free threshold be increased to 2.4 million rupees a year from the current 1.2 million and to “equitably” amend tax rates and tax brackets.
The NPP’s election manifesto released in August also proposed that the tax base be widened according to taxation fundamentals.
Increasing the tax-free threshold to include people who earn up to 200,000 rupees a month will likely exclude many people from the tax base, however.
Dissanayake first proposed this increase in January 2023. He also said at the time that an NPP government would cap progressive taxation at a maximum of 24 percent.
“We will definitely reduce this tax,” he said.
Treasury Secretary Mahinda Siriwardana said in August that Sri Lanka’s planned relief to personal income tax payers could cost 0.08 percent of gross domestic product in lost revenues and would be compensated by additional tax measures.
The Dissanayake administration has retained the services of Siriwardena since the change in government.
Then President Ranil Wickremesinghe also said in August that Sri Lanka and the IMF had discussed giving income tax relief by widening tax slabs.
“The Treasury began negotiating such an amendment with the IMF as far back as September 2023,” Siriwardana said, speaking at an event.
“It was not possible to implement such a proposal previously given the fact that revenue was falling short of targets.
“However, with the improvement in revenue performance this year, it has become possible to negotiate an adjustment to the PIT (Personal Income Tax) structure which provides some relief to the tax payers in the middle bands, whilst ensuring there isn’t an excessive gain for the highest income earners.
“The proposed adjustment to the PIT is estimated to cost around 0.08 percent of GDP and compensating revenue measures have already been discussed with the IMF, such that revenue targets are not compromised,” he said.
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Discussion on Sri Lanka Customs’ contribution for National Export Development Plan
A discussion on the modernisation initiatives required within the Sri Lanka Customs and measures to encourage exporters in support of implementing the National Export Development Plan (NEDP) 2026–2030 was held on Wednesday (17) morning at the Presidential Secretariat under the patronage of Secretary to the President, Dr. Nandika Sanath Kumanayake.
The meeting, organised by the Revenue Administration Reform and Modernization Bureau established under the Presidential Secretariat, focused extensively on the modernisation measures required within Sri Lanka Customs to facilitate the expansion of exports.
During the discussion, the Secretary to the President instructed Sri Lanka Customs to enhance the capacity, facilities and modernisation of the Export Facilitation Centre, where export containers are inspected, in order to create a more efficient and exporter-friendly environment.
Attention was also drawn to developing a programme aimed at encouraging exporters across the country to enter the export sector. The Secretary to the President further emphasised the need to review the Temporary Import for Export Processing (TIEP) scheme currently operated by the Customs Industrial Facilitation Division and to introduce a programme to support small and medium-sized enterprises (SMEs) that have not yet engaged in export activities.
The meeting also explored the possibility of decentralising customs operations to support the expansion of the export sector, with particular attention given to establishing a Customs Export Centre in Jaffna.
Discussions were also held on removing barriers affecting exports conducted through e-commerce platforms. It was decided to hold further discussions with the Department of Posts on measures that could be taken jointly to streamline these processes.
Participants also discussed introducing digital systems to expedite document processing, thereby reducing both, time and costs, as well as implementing a risk-based assessment mechanism that would provide greater facilitation for low-risk exporters.
It was further decided that Sri Lanka Customs, the Sri Lanka Export Development Board (EDB) and other relevant institutions would meet monthly under the leadership of the Revenue Administration, Reforms and Modernisation Bureau of the Presidential Secretariat to review progress, identify challenges faced by exporters and discuss appropriate solutions.
The National Export Development Plan has been formulated in line with the national vision, “A Thriving Nation – A Beautiful Life”, with the objective of enhancing Sri Lanka’s export competitiveness and achieving an ambitious yet realistic export revenue target of USD 36 billion by 2030.
Director General of Customs Wimal Liyanagama, Chairman of the Sri Lanka Export Development Board (EDB) Mangala Wijesinghe, Additional Directors General of Sri Lanka Customs T. Loganathan and L.K.S.D.K. Arewatta, Director of the Sri Lanka Export Development Board Dr. Sanjeewa Rathnasekara, Director of the Revenue Administration, Reforms and Modernisation Bureau of the Presidential Secretariat W.L.C. Thilakasiri and senior officials from Sri Lanka Customs and the Sri Lanka Export Development Board were also present.
[PMD]
News
Military held land: Govt. trying to maintain balance between security and civilian needs
The NPP government is trying to maintain a balance between continuing demands for releasing north-east land held by the military and post-war security requirements, says Deputy Defence Minister Major General Aruna Jayasekera (Retd), who has undertaken a series of visits to the northern and eastern provinces in the recent past to explore ways and means of releasing the land, without compromising national security requirements.
Since the armed forces brought the war to a successful conclusion in May, 2009, releasing of both privately- and state-owned land began cautiously in October, 2009, and by now over 90 percent of both categories have been released. At the height of the war, before the launch of Eelam War IV, in August 2006, Jaffna peninsula had the largest concentration of troops assigned to four Divisions.
In the first week of June, Deputy Minister Jayasekera visited the Trincomalee District to ascertain the situation. The Defence Ministry said that the Deputy Minister had assessed the current status of such lands and received briefings from senior military officers and relevant officials on security and administrative aspects regarding the properties.
Following the field inspection, the Deputy Minister chaired a meeting at the Governor’s Secretariat Office where the discussion focused on what the Defence Ministry called a balanced and practical approach to address land-related issues, protect the livelihoods of the people, and ensure that national security requirements were properly managed.
Jayasekera, with a career spanning well over three decades, retired in November, 2019, after having last served as the Eastern Commander for about a year.
During his June visit, the Deputy Minister visited various security forces establishments, including the 22 Infantry Division.
A senior retired military official said that those who had been demanding that all security forces held land, both state- and privately-owned, be released, have conveniently forgotten that this was made possible due to the eradication of the LTTE.
The Deputy Defence Minister conducted a series of field visits in the Jaffna and Wanni regions to assess the security situation and operational commitments. According to the Defence Ministry, the Deputy Minister addressed senior tri forces personnel at the Security Forces Headquarters – Jaffna (SFHQ-J) and the Security Forces Headquarters – Wanni (SFHQ-Wanni).
The Deputy Minister chaired civil-military coordination meetings in the Mannar and Jaffna districts to the ongoing land ownership issues, fostering socio economic growth, and streamlining local infrastructure layout in close cooperation with the regional administrative mechanism. The Ministry said that the Deputy Minister inspected agricultural zones, private residences and public common areas, presently placed within the operational infrastructure of the Sri Lanka Navy across several locations, in Mullikulam, Silawathura, Talaimannar, Wankalapadu, and Pallimune.
Members of Parliament for the Vanni Electoral District, Selvam Adaikalanathan, Kader Masthan, Thurairasa Ravikaran and the District Secretary for Mannar were also present at the meeting where matters related to socio economic grievances, local infrastructure demands, and land rights of the local residents were central topic in the agenda.
The Deputy Minister of Defence chaired a second meeting at the Governor’s Office in Jaffna where the main focus was existing land issues in the districts of Vavuniya, Mannar, Mullaitivu, Kilinochchi, and Jaffna.
The Jaffna proceedings were co-chaired by the Minister of Fisheries, Aquatic and Ocean Resources and Chairman of the District Coordinating Committee for the Jaffna and Kilinochchi Districts Ramalingam Chandrasekar and Deputy Minister of Co-operative Development Upali Samarasinghe.
The Defence Ministry said that stability depended on striking an optimal balance between prioritising national security obligations and resolving outstanding issues related to both state owned and privately used lands. “We are implementing a transparent mechanism to swiftly transition designated lands back into the hands of local communities for housing, fishing, and agriculture.”
The participation of the Commander of the Army and the Commander of the Navy underscored the importance of the discussions held in the north.
In the Mannar region the focus was on lands, presently used by the Navy, in the areas of Mullikulam, Silawathura, Talaimannar, Wankalapadu, and Pallimunai.
Authoritative sources said that since the end of the war, the military had given up held areas and what remained occupied were essential for security purposes. The depletion of the area under direct control should be examined taking into consideration gradual overall reduction of combined security forces strength over the years. At the end of the war, the Army had approximately 205,000 officers and men, both regular and volunteer. That figure has been reduced to 150,000 to 160,000. In line with the government thinking the Army strength would be brought down to 100,000 by 2030, a plan first announced by President Ranil Wickremesinghe.
By Shamindra Ferdinando
News
Yoshitha granted bail, travel ban imposed
Colombo Chief Magistrate Lahiru de Silva yesterday granted bail to Yoshitha Rajapaksa, second son of former President Mahinda Rajapaksa, on three sureties of Rs. 5 million each, and imposed an overseas travel ban.
The Commission to Investigate Allegations of Bribery or Corruption (CIABOC) arrested Yoshitha yesterday morning when he called over to make a statement regarding an ongoing investigation into his recruitment to the Sri Lanka Navy and training at the UK Royal Naval Academy.
CIABOC said that the arrest had been made in connection with an investigation into the 2006 recruitment of cadet officers to the executive branch of the Sri Lanka Navy.
It has been alleged that individuals were recruited without meeting the required qualifications and state funds were used outside established procedures for their training at the Royal Naval Academy in the UK.
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