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How tax revision that caused revenue loss of Rs 500-600 bn triggered collapse …
Dr. Godahewa dealt with anatomy of developing crisis
By Shamindra Ferdinando
SLPP lawmaker Dr. Nalaka Godahewa has alleged that those who managed the economy during Gotabaya Rajapaksa’s tenure as the president conveniently failed to take remedial measures though alleged faults were pointed out.
Dr. Godahewa, a key member of the dissident group that voted against the emergency said the then President Gotabaya Rajapaksa could have averted the disastrous consequences if corrective measures were taken. However, the decision makers remained committed to previously taken decisions regardless of the consequences, one-time Viyathmaga activist alleged.
Addressing a group of supporters at Gampaha recently, Dr. Godahewa cited the much disputed tax restructuring that had been introduced soon after Gotabaya Rajapaksa’s overwhelming victory at the 2019 presidential election. Pointing out that tax revisions deprived the government Rs 500-600 bn annually, the Gampaha District MP questioned the failure on the part of the decision makers to take remedial measures. Action could have been taken in 2020 or 2021, but the powers that be chose to ignore criticism pertaining to the tax revisions, Dr. Godahewa said.
The government abolished a range of taxes, including PAYE (Pay As You Earn), NBT (Nation Building Tax), Withholding tax, Capital Gain tax imposed on the Colombo Stock Exchange, Bank Debit tax and unprecedented reduction of VAT (Value Added Tax). In addition to those revisions 15% VAT and the 2% NBT which amounted to 17% imposed on all goods and services were unified and reduced to 8%, effective from Dec 01, 2019. Controversial decision in this regard has been taken at the first cabinet meeting of the Gotabaya Rajapaksa government held on Nov 27, 2019.
Total income dropped to Rs 1,373 in 2020, though total revenues for 2018 and 2019 had been Rs 1,950 bn and Rs 1,900 bn, respectively.
Shouldn’t those decision makers be held responsible for a much bigger budget deficit and continuously printing of money to meet a shortfall of Rs 2,000 bn annually? he asked.
Though Easter attacks, the pandemic and the resultant body blow to the vital tourism sector and steep drop in migrant worker remittances aggravated the situation, the first time entrant to parliament primarily faulted President Gotabaya Rajapaksa for the current crisis. Dr. Godahewa said that having repeatedly assured the electorate he wouldn’t allow family rule, President Rajapaksa placed the economy in the hands of those who mismanaged the economy over the past several decades. Dr. Godahewa pointed out that following the general election in August 2020, those who had been rejected in 2015 received cabinet portfolios. In the wake of the country being declared bankrupt, those who had been overwhelmingly rejected in 2019 received an opportunity to regain power.
The former media minister was referring to UNP leader securing parliamentary approval to complete the remainder of Gotabaya Rajapaksa’s mandate.
Dr. Godahewa asked whether longstanding issues at hand could be addressed by the above-mentioned two groups swapping political power from time to time and in some instances working together. The outspoken politician quoted Fitch Ratings as having recently stated that far reaching changes couldn’t be expected under President Ranil Wickremesinghe’e leadership as those who had been rejected by the people were behind him.
Dr. Godahewa was referring to the SLPP engineering Wickremesinghe victory at the July 20 presidential contest. Dr. Godahewa backed Dullas Alahapperuma, who obtained 82 votes whereas Wickremesinghe polled 134. The group that voted for Wickremesinghe largely backed the imposition of emergency with 120 voting for and 63 against in the 225 member parliament.
MP Godahewa said that the country could overcome the daunting economic challenges. The MP said that he was not sure whether the incumbent Cabinet-of-Ministers had the capacity and the commitment to implement what was agreed during consultations among political parties in the run-up to Wickremesinghe election as the President. Whatever the developments, now that Wickremesinghe has been installed as the President, the new administration should be given the time and the space to address the issues, he said.
Lawmaker Godahewa strongly censured the electorate for habitually electing the same corrupt lot though they always demanded what he called a system change. The MP warned the electorate that there was absolutely no point in demanding ‘a system change’ if they exercised their franchise for those who ruined the country.
Declaring that there could be fresh protests similar to the massive public eruption on July 09 in Colombo, Dr. Godahewa urged the electorate to correctly identify those responsible.
Former Finance Minister Ali Sabry, PC, appearing on Swarnavahini in early June named the then President’s economic advisor (Dr. PBJ), Governors of the Central Bank (Prof. W.D. Lakshman and Ajith Nivard Cabraal) and the Treasury Secretary (S.R. Attygalle) as the culprits.
Dr. Godahewa said that the government required as much as USD 5-6 bn annually to settle loans amounting to USD 24.7 bn taken between 2004 and 2019. The MP emphasized the urgent need to examine the utilization of these funds, particularly unproductive investments made over the years. The former private sector top executive questioned whether a part of foreign loans obtained at exorbitant rates had been robbed.
The lawmaker said today the public had forgotten the Treasury bond scams that had been perpetrated in Feb 2015 and March 2016, finalization of 99-year- leasing of the Hambantota port to China in 2017 at terms utterly disadvantageous to Sri Lanka, sharp drop in economic development from 5.5% to 2.1% and depreciation of the Rupee by 40 percent during yahapalana administration. At the time, Gotabaya Rajapaksa won the presidency in late Nov 2019, the country had USD 7.6 bn in reserves sufficient to meet the import bill for a couple months, Dr. Godahewa said.
Referring to a recent controversial public declaration made by Public Administration Secretary Priyantha Mayadunne, Dr. Godahewa said that those who had recklessly expanded the public sector at the expense of the overall financial stability, too, should accept the responsibility for the current crisis.
The MP pointed out that there had been approximately 500,000 public sector employees in 2004 but over the years the total increased to a staggering 1,402,000. Dr. Godahewa cited the 2021 figures to highlight the crisis. Of Rs 1,238 bn tax revenue, Rs 1,115 bn or 90 percent of the total had been spent on public sector salaries and pensions.
Stressing the extreme difficulty in raising USD 500 mn required for fuel imports, particularly for power generation, Dr. Godahewa alleged that those who deliberately delayed power generation projects, too, should accept the blame for Sri Lanka’s current predicament.
Dr. Godahewa queried how the sudden introduction of mandatory use of carbonic fertilizer without a proper study ruined the agriculture sector. Those who decided on the agriculture policy as well as proponents of that move, too, should be held responsible for the overwhelming crisis.
Much touted projects to send trained personnel abroad and expansion of the information technology sector couldn’t achieve desired results as those entrusted with the said tasks failed, the former minister said.
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Gnanasara Thero absconding after SC ruling
Ven. Galagoda Aththe Gnanasara Thero was not at his temple in Rajagiriya when prison officials visited the premises yesterday to take steps following the Supreme Court ruling that nullified the presidential pardon granted to him, police sources said.
Prison officials who visited the temple on Nawala Road, Rajagiriya, were reportedly informed by those present that the Thero’s whereabouts were unknown. The development comes a day after the Supreme Court declared former President Maithripala Sirisena’s 2019 pardon of Gnanasara Thero null and void.
The three-member Supreme Court bench comprising Justices Janak De Silva, Dr. Sobhitha Rajakaruna and Sampath B. Abayakoon held that the pardon was arbitrary, violated the public trust and principles of natural justice, and was made beyond the proper exercise of the President’s constitutional discretion.
The case arose from Gnanasara Thero’s conduct at the Homagama Magistrate’s Court in January 2016 during proceedings relating to the disappearance of journalist and political cartoonist Prageeth Eknaligoda.
The Court of Appeal convicted him on four counts of contempt of court in 2018 and imposed concurrent prison terms amounting to six years. He had served about nine months when Sirisena granted him a presidential pardon on May 23, 2019.
The Supreme Court found that although Article 34 empowers the President to grant pardons, that power is held in trust for the people and is subject to constitutional limitations and judicial review. The Court concluded that Sirisena had effectively acted on the recommendation of the Additional Secretary (Legal) without demonstrating that he had independently considered the relevant material.
Justice De Silva held that the pardon was “arbitrary”, violated public trust and the rules of natural justice, and was ultra vires the President’s powers. The Court consequently found that the decision violated the fundamental right to equality guaranteed by Article 12(1) of the Constitution.
The ruling effectively restores the legal position under the original conviction, leaving Gnanasara Thero without the benefit of the 2019 pardon. The Supreme Court also clarified that a pardon does not erase a conviction or sentence, but merely relieves an offender from serving the sentence to the extent specified in the pardon.
Gnanasara Thero, the General Secretary of the Bodu Bala Sena, had been convicted over his conduct during proceedings concerning the disappearance of Eknaligoda, who went missing in January 2010 and has not been located.
Sandhya Eknaligoda, Prageeth Eknaligoda’s wife, was among those who challenged the presidential pardon before the Supreme Court, alongside the Centre for Policy Alternatives and its Executive Director Dr. Paikiasothy Saravanamuttu.
The detailed account of the judgment indicates that the Court’s ruling primarily nullified the pardon and restored the legal effect of the original sentence, with the implementation of the sentence falling to the relevant authorities.
Police sources said that the Supreme Court, however, did not permanently close the door on executive clemency. It held that a future President could grant Gnanasara Thero another pardon, provided the power is exercised lawfully and after proper consideration of all relevant material.
The Supreme Court has so far overturned three presidential pardons granted to two former Presidents. In January 2024, the Court declared former President Gotabaya Rajapaksa’s pardon of former MP Duminda Silva unlawful and invalid. In June 2024, it invalidated two pardons granted by former President Maithripala Sirisena to Royal Park murder convict Jude Shramantha Anthony Jayamaha — the first in May 2016, which commuted his death sentence to life imprisonment, and the second in October 2019, which released him from prison. Jayamaha, who was convicted of the murder of 19-year-old Yvonne Johnson, remains at large. Most recently, on September 10, 2026, the Supreme Court declared Sirisena’s 2019 pardon of Ven. Galagoda Aththe Gnanasara Thero null and void, ruling that it was arbitrary and inconsistent with the Constitution.
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House to debate 22A, Judicature Bill next week
Parliament is scheduled to debate the Twenty-Second Amendment to the Constitution Bill and the Judicature (Amendment) Bill on September 24 and 25, subject to the Speaker’s announcement following the delivery of the Supreme Court determination on petitions filed against the Bills.
The programme for the Parliamentary Week from September 22 to 25 was decided at a meeting of the Committee on Parliamentary Business held on Thursday (10) under the chairmanship of Speaker Dr. Jagath Wickramaratne.
On each sitting day, Parliamentary Business under Standing Orders 22(1) to 22(6) will be taken up from 9.30 am to 10 am, followed by Questions for Oral Answers from 10 am to 11 am Questions under Standing Order 27(2) will be taken up from 11 am to 11.30 am.
On Tuesday (22), the Orders published in Extraordinary Gazette No. 2497/37 under the Petroleum Resources Act and the Promotion of Export Agriculture (Amendment) Bill will be debated from 11.30 am to 5 pm.
The Tredso Development Foundation (Incorporation) Bill, a Private Member’s Bill, will then be taken up for Second Reading before being referred to the Legislative Standing Committee.
An Opposition motion at the Adjournment Time will follow.
On Wednesday (23), the Chartered Institute of Media Professionals of Sri Lanka Bill will be debated from 11.30 am to 5 pm, followed by Questions at the Adjournment Time.
The Second Reading debate on the 22nd Amendment Bill and the Judicature (Amendment) Bill is scheduled for 11.30 am to 7 pm on Thursday (24) and Friday (25).
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Wrong house targeted in underworld grenade attack: Two children killed
Two children aged 11 and 17 were mistakenly killed and their 55-year-old father injured in an early morning hand grenade attack on Sirisangabo Mawatha on Friday. Police investigations later revealed that the attackers targeted the wrong house during an ongoing underworld clash.
Three police teams have been deployed to investigate the attack, which occurred at around 3 am.
According to police, a man who arrived near the house in a three-wheeler knocked on the front door before throwing a grenade into the premises and fleeing.
The victims were identified as 17-year-old Kasun Rashmika and 11-year-old Duminda Gihan. Their 56-year-old father, Nalin Thusantha Perera, was seriously injured and admitted to the Kalubowila Teaching Hospital.
Police said the injured man’s brother was allegedly a close associate of a drug trafficker known as ‘Sando’ and had also been accused of involvement in drug trafficking.
The brother lives in a house adjoining the one targeted in the attack, and police suspect the grenade may have been thrown at the wrong house.
Police are also investigating information that the attack was allegedly carried out at the direction of several overseas-based drug traffickers, identified as Pandithage Shantha Kumara alias ‘Kos Malli’, Samantha Perera alias ‘Chuwa Samantha’, ‘Kudu Avishka’ and ‘I.D.’
Police said the attack was believed to be linked to an ongoing conflict between two underworld factions, which have targeted each other’s associates in shootings and grenade attacks. More than 20 people have reportedly been killed in such attacks.
Security agencies are also investigating alleged links between one faction and overseas-based criminals including Kanjipani Imran, Unakuruwe Shantha, Dubai Gagana and Handaya.
Security agencies have also received information that overseas-based criminals identified as Kanjipani Imran, Unakuruwe Shantha, Dubai Gagana and Handaya are allegedly behind the supply of firearms and drugs to the faction associated with Kos Malli and Chuwa Samantha.
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