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Sajith defends progressive taxation, highlights inequality
ECONOMYNEXT –Days after he lambasted the government for its tax policy, Sri Lanka opposition leader Sajith Premadasa defended progressive taxation noting a serious income inequality in the crisis-hit South Asian nation.In a meeting held in Kandy with the city’s business community, Premadasa said the main opposition Samagi Jana Balawegaya (SJB) has a team of politicians who are experts on economic policy formulation.
“There is serious imbalance (inequality) in our country. Eighty percent of our tax revenue is from indirect taxes. The remaining 20 percent is through progressive taxation where the tax paid increases as income rises,” said Premadasa.
Progressive taxation is fair and equitable, he said.
“What we first need to do is correct this imbalance. We have practical economists with us. There needs to be politicians who understand monetary policy, tax policy and all national policies. The politician cannot be subservient to the advice of officials alone.
“Our political team is one that possesses great knowledge of economic policy,” he added.Speaking at an election rally in Thambuttegama on February 12, the SJB leader criticised the government for its income tax hike.
“The ali pohottu kaputu government is burdening the people with taxes. We hear they’re planning to impose a tax on people who earn 45,000 rupees a month too. Just great,” said Premadasa addressing a large crowd of SJB supporters.
Premadasa was likely referring to reports that the International Monetary Fund (IMF) had asked the government to impose taxes on anyone who earns above 41,667 rupees a month as a condition for a 2.9 billion US dollar extended fund facility. However, the tax threshold remains at 100,000 rupees a month and there is no indication yet that it will be lowered.At an economic summit organised by the SJB in Colombo on February 14, SJB legislator Harsha de Silva presented the party’s proposals for tax reform under an SJB government.
The MP said the party supports progressive tax and that the highest earners should even pay as 39 percent if not more. He also took a swipe at rival opposition group the National People’s Power (NPP) which recently proposed that the tax threshold be increased to 200,000 rupees a month and the highest tax rate be capped at 24 percent.
The SJB’s Economic Blueprint acknowledges that the government has conducted tax reforms, but in its implementation has imposed too high a burden on Sri Lanka’s middle class, disincentiviseing exporters.
The document noted: Both personal and corporate income taxes have been revised. Personal income tax threshold and slabs were reduced, and marginal tax rates revised upwards. The VAT rate was increased, and the threshold was revised downwards, helping expand the tax net.
However, the revised personal and corporate income tax rates are much higher than in the 2017 Inland Revenue Act. The significant increase in personal income tax via PAYE during high inflation has imposed significant burdens on most professional groups. Tax slabs should be broadened in such a way that professionals (perhaps earning up to LKR 500,000 per month) are subjected to a top marginal tax rate of around 25% with the highest marginal rate going up to around 40% for the very high income earners with a temporary surcharge).
It must be noted that the government’s estimate of LKR 100 bn in PAYE tax collection for 2023 is highly questionable given the recent statements in Parliament by the State Minister of Finance that only 120,965 persons were liable to PAYE tax from over 1.1 mn registrations at the end of 2019. An urgent study must be conducted on this discrepancy and steps must be taken immediately to ensure those who are liable to pay taxes, pay.
Beyond PAY, it is essential that citizens of all walks of life who by various means avoid paying taxes are brought into the tax net. The only way to meet the objective of a genuine and stable increase in taxes is by expanding the base, not by squeezing to the bone the few who pay.
News
Sri Lanka ITEC Alumni Association formally launched
Sri Lankan professionals trained in India under the Indian Technical and Economic Cooperation (ITEC) programme have formed a national alumni association. The Sri Lanka ITEC Alumni Association was formally launched at its inaugural meeting on Thursday, 8 October 2026, at the Grand Crystal Ballroom of Hotel Taj Samudra, Colombo.
The Association is a unique initiative of the Education Wing of the High Commission of India in Sri Lanka. The Wing oversees India’s education and scholarship programmes for Sri Lanka, including the ITEC programme. The initiative was led by Sandeep Chaudhary, First Secretary (Education), High Commission of India. His vision and support were key to bringing Sri Lanka’s ITEC alumni together under one platform for the first time.
The Government of India launched ITEC in 1964, and it has since become one of the cornerstones of India’s development partnership with countries of the Global South. The programme is fully funded by the Government of India and offers civilian training in a wide range of fields, including public administration, finance, information technology, engineering, management, agriculture, health and the environment. Courses are delivered at leading Indian institutions. Over six decades, ITEC has trained officials and professionals from more than 160 partner countries. Sri Lanka has been one of its most active participants, and thousands of Sri Lankan public servants and professionals have benefited from the programme.
The new Association brings these alumni together from government, semi-government and private sector institutions. Its aims are to foster professional networking, knowledge sharing, capacity development and community service. It will also encourage collaboration among alumni and guide and support future Sri Lankan participants in ITEC programmes. In doing so, the Association seeks to deepen the long-standing friendship and people-to-people ties between Sri Lanka and India.
At the meeting, members elected an Executive Committee to lead the Association. Ms. Gayathri Suveendran was elected President. The other office-bearers are:
Vice Presidents: P.B. Hasith Sandaruwan and Leo Darshan
General Secretary: Anupa Weerarathne
Assistant Secretary: Vimukthi Dushantha
Treasurer: S. Rubadharshan
Assistant Treasurer: I. Ravikumar
Four sectoral committees will carry the Association’s work forward:
Establishment, Administration and Finance: Prof. M.I.M. Mujahid Hilal, M. Farwis, Milroy Aluthwatta, W.P. Suraweera, M.S. Thayaraj and Asinsala Senevirathne.
ICT, Digital Transformation and Innovation: Sujah Ameer, Danushka Diunugala, T.M.M. Perera, Tharanga, M.K.H.P. De Silva, Pubuditha Madushan and Arulkumaran Mahalingam.
Coordination, Organising and Legal Affairs: T. Srirajeevan, Theja Jayathilaka, Eng. A. Lingeswaran, Chaminda K. Uda, Kumuduni, S. Sinthujan and Ananda Arasu.
Media, Public Relations and Publications: Rahul Samantha Hettiarachchi, Dr. Gayani Kaushalya, Anandi Premarathne, Vimukthi Dushantha, R. Suhanthan and Shyam Nuwan Ganewatta.
The founding of the Association marks a significant milestone for the ITEC community in Sri Lanka. It turns individual training experiences in India into a shared national resource, and it adds a new professional dimension to the enduring partnership between the two neighbours.
News
Measures underway to protect Diyagama Forest as a Reserve — Deputy Minister of Environment
The government is taking all necessary measures to protect the Diyagama forest area located in Homagama within the Colombo District, Deputy Minister of Environment, Anton Jayakody,
stated on Friday (9) while delivering a special address in Parliament.
Originally an abandoned plot of land, it has regenerated naturally over the past two decades into a sensitive ecosystem bearing the characteristics of a rainforest. With rapid urbanization, numerous wildlife species displaced across
the Colombo District have now migrated to and found sanctuary in this ecological haven.
Citing field research conducted by a team of scholars from the University of Colombo—including Prof. S.W. Ranwala, Prof. Ileperuma, and Prof. Abeykoon—the Deputy Minister pointed out that nearly 120 species of flora and fauna have been identified in the area. Among them are species endemic to Sri Lanka, as well as rare wildlife such as the red slender loris and pregnant animals close to giving birth, clearly testifying to the rich biodiversity thriving within this habitat.
Located adjacent to the Mahinda Rajapaksa International Stadium and the Japan–Sri Lanka Friendship Baseball Ground, this green zone serves as a vital ecosystem for absorbing carbon
dioxide emitted by athletes and residents in the vicinity.
In addition to directly contributing toward Sri Lanka’s commitments under the Paris Agreement to achieve net-zero emissions by 2050, the forest also functions as a vital catchment area feeding into the Bolgoda water basin.
Accordingly, following the approval of the Colombo District Coordinating Committee (DCC) with the participation of the Divisional Secretary, government officials, and environmentalists, steps will be taken to submit a Cabinet paper to formally declare this valuable woodland a forest reserve, the Deputy Minister emphasized.
News
NPP govt. reminded of its responsibilities as US warship leaves Colombo
Stranded Iranian ships off SL:
Iran has reminded Sri Lanka that as a member of the UN the government is obligated to fulfil its responsibilities.
Iranian Ambassador Alireza Delkhosh in Colombo said that in terms of the Convention on the Law of the Sea (Article 98) as well as SOLAS and SAR Conventions, Sri Lanka couldn’t refrain from providing the needs of the Iranian vessels stranded in its Exclusive Economic Zone (EEZ).
Ambassador Delkhosh was responding to a recent Foreign Minister Vijitha Herath’s declaration that neither the government nor private companies would provide food, water and medicine to these ships.
The Ambassador questioned how Sri Lanka accepted illegal and unilateral US sanctions against Iran, contrary to the JVP’s much touted historic anti-imperialistic manifesto.
The Iranian vessels are believed to be under constant US surveillance to prevent any supplies from getting through.
The Iranian Embassy made these comments as USS Tulsa (LCS 16), an Independence-variant littoral combat ship arrived in Colombo where it received supplies. The US Embassy declared that; ” this goodwill visit provides an opportunity to strengthen ties between US and Sri Lankan sailors while the ship refuels and resupplies before continuing its mission in the Indo-Pacific.”
Ambassador Delkhosh said that even if the above-mentioned Conventions weren’t adhered to, there existed, what he called, unwritten yet binding conventions that compelled Sri Lanka to assist. “It is the Convention of not forgetting past friendship and Convention of Humanitarian Actions.”
The Iranian envoy emphasised that these conventions that exempt no country from extending humanitarian aid, especially Sri Lanka, which, throughout its recent history, has been a recipient of Iranian assistance.
A section of the international media reported that Sri Lanka faced the risk of secondary sanctions from the United States if Sri Lanka allowed supplies to reach the stranded Iranian vessels. Twenty vessels are believed to be stranded in EEZ.
Former Sri Lankan Ambassador in Tehran, M.M. Zuhair, recalled how the Iranian government swiftly and decisively provided assistance, amidst western efforts to jeopardise the military campaign, by undermining the national economy.
As the war entered a crucial stage, the government found itself in an extremely difficult situation. Following talks at the highest level, Iran provided Sri Lanka with an interest-free and concessionary oil credit facility worth $1.05 billion to help obtain crude oil requirements, President’s Counsel Zuhair said.
If not for the rolling credit line, easing severe foreign exchange pressures, the Rajapakasa government could have faced an insurmountable challenge, the former diplomat said, adding that, unfortunately, those in decision-making positions now have forgotten the past. (SF)
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