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COPF calls for review of VAT changes impacting medical, agricultural sectors
The Committee on Public Finance (COPF), at a recent meeting, requested the Ministry of Finance to consider VAT exemptions for medical equipment, ambulances, high-protein agro foods for children, and agricultural items.
The Committee made that request in respect of the Value Added Tax (Amendment) Bill, The Finance Bill amending the Finance Act, No. 35 of 2018 and the Finance Act, No. 12 of 2012, and the Imports and Exports Control Act related to Gazette No. 2353/16.
The Committee questioned the rationale behind including VAT for agricultural items, which will impact the domestic agricultural and food industry.An official representing the Ministry of Finance stated that agricultural machinery and other equipment, including chemical fertilizer previously listed as exempted, will now be liable for VAT under the said Bill. Finance ministry officials added that dairy products such as liquid milk and eggs will also be subject to VAT.
However, agricultural seeds, agricultural plants, shrimp feed including prawn feed, and animal feed excluding poultry feed will be exempted from VAT. Wheat, wheat flour or powdered milk, pharmaceutical products, and drugs will also be exempted.
The Committee highlighted products made from grains cultivated in Sri Lanka, identified as high-protein and high-energy agro foods, are now subjected to VAT at a time when child malnourishment is considered to be on the rise.
The Committee also questioned why ambulances and medical equipment are being subjected to VAT.
After thoroughly examining the Value Added Tax (Amendment) Bill, the Committee granted approval, contingent upon the Ministry of Finance incorporating the proposed amendments by the Committee on Public Finance, provided they are in agreement.
However, the Committee urged the officials to reassess VAT exemptions for medical equipment, ambulances, fertiliser, and food products derived from grains classified as high-protein agro foods and agricultural items.
The Committee on Public Finance further revealed that the elimination of VAT exemptions will not impact the fares of UBER and PickME. Dr. Harsha de Silva, the Committee Chair, emphasised that as UBER and PickME have included VAT since their inception, contrary to other beliefs, the proposed VAT changes will only result in a 3% rise without significantly affecting the ultimate fare that customers are required to pay.
The Committee on Public Finance also considered the Finance Bill amending the Finance Act, No. 35 of 2018 and the Finance Act, No. 12 of 2012, which proposes provisions to release motor vehicles imported into Sri Lanka that were not cleared from customs due to import restrictions or non-payment of taxes.
However, given the matters arising from importing and opening LCs post the suspension of motor vehicle imports by Gazette Extraordinary No. 2176/19 dated May 22, 2020, under the Import and Export Control Act, the Committee Chair instructed the Ministry of Finance to submit a report on the provisions to release 119 imported vehicles yet to be cleared from customs. The Committee thus decided to reconsider the said from thereon.
Moreover, following the consideration of the Imports and Exports Control Act related to Gazette No. 2353/16, the Committee approved the said.
State Ministers Shehan Semasinghe, (Dr.) Suren Raghavan, Members of Parliament Patali Champika Ranawaka, Nimal Lanza, Isuru Dodangoda, Madhura Withanage, Mahindananda Aluthgamage, Wajira Abeywardena, and Harshana Rajakaruna, were present at the Committee meeting held.
Indian Prime Minister Shri Narendra Modi departed today (06) from Air Force Base Anuradhapura concluding his State visit to Sri Lanka. The Indian Premier embarked on a tour to Sri Lanka at the invitation from President Anura Kumara Disanayake.
This visit underscores the enduring relationship encapsulated by the theme “Friendship of Centuries, Commitment to a Prosperous Future,” further solidifying the bonds between India and Sri Lanka.
This marks Prime Minister Modi’s fourth visit to Sri Lanka, which has further enhanced the economic, cultural, and historical relations between the two nations, while also reinforcing their multifaceted partnership. This visit by the Indian Prime Minister reinforces Sri Lanka’s important role in India’s “Neighbourhood First Policy” and ‘MAHASAGAR’ vision concerning diplomatic relations.
This state visit is anticipated to yield significant results on various collaborative initiatives, fostering a path towards mutual growth and development. The citizens of Sri Lanka will soon be able to witness the fruitful outcomes of these partnerships, and Indian Prime Minister Shri Narendra Modi’s visit will mark a significant milestone in the government’s pursuit of sustainable development focused on the needs of the people.
Accompanying Indian Prime Minister Modi were Indian External Affairs Minister Dr. S. Jaishankar, National Security Advisor Ajit Doval, Foreign Secretary Vikram Misri and a delegation of senior officials from the Indian government.
[PMD]
Latest News
President Dissanayake and Indian PM Modi jointly commission upgraded Maho-Omanthai railway line & Maho-Anuradhapura railway signalling system
The upgraded Maho–Omanthai railway line and the newly installed Maho–Anuradhapura railway signalling system were officially commissioned by Indian Prime Minister Shri Narendra Modi and President Anura Kumara Disanayake today (06)
The Prime Minister of India is currently visiting Sri Lanka at the invitation of President Anura Kumara Disanayake, reinforcing the longstanding bond encapsulated in the theme “Friendship of Centuries Commitment to a Prosperous Future” between the two nations.
Highlighting one of the key aspects of this visit, the two leaders participated in these inaugural ceremonies. The President and the Prime Minister of India jointly unveiled the commemorative plaque and commissioned the railway line and signalling system.
The upgraded Maho-Omanthai Railway Line project was carried out with funding through the Indian Credit Line, totalling an investment of US$ 91.27 million. The Maho–Anuradhapura railway signalling system, established as a result of President Disanayake’s recent visit to India, was funded by the Indian Government at a cost of USD 14.89 million.
[PMD]
Latest News
Prime Minister Modi and President Dissanayake pay homage to the sacred Jaya Sri Maha Bodhi
Indian Prime Minister Shri Narendra Modi, currently on a State visit to Sri Lanka, along with President Anura Kumara Disanayake paid homage to the sacred Jaya Sri Maha Bodhi in Anuradhapura this morning (06) and received blessings.
Following his visit to the sacred site, Prime Minister Modi proceeded to the Udamaluwa, where he met with the Chief Incumbent of the Atamasthanadhipathi and Chief Sanghanayake of Nuwarakalaviya, Most Venerable Dr. Pallegama Hemarathana Nayaka Thera, for a cordial discussion.
During the meeting, the Prime Minister shared that relics of the Buddha were discovered in excavations conducted in his home state of Gujarat during the 1960s. He further stated that he would discuss with the President of Sri Lanka the possibility of exhibiting these sacred relics in Sri Lanka.
Responding to a request made by the Atamasthanadhipathi to develop Bodh Gaya as a spiritual city, Prime Minister Modi assured that he would take the necessary steps after discussions with President Disanayake and work towards making it a reality.
The Maha Sangha, led by the Atamasthanadhipathi, chanted Seth Pirith and invoked blessings on the Indian Prime Minister.
The Indian Prime Minister also left a commemorative note in the special guest book at the site. In addition, he formally declared open the newly constructed ‘Makara Thorana’ within the Jaya Sri Maha Bodhi premises.
The occasion was also attended by Chief Incumbent of the Ruwanweli Maha Seya Temple Ven. Ethalawetunawewe Gnanathilaka Thera and other Atamasthana Viharadhipathi Theras, Minister of Foreign Affairs, Foreign Employment and Tourism Vijitha Herath, Minister of Trade, Commerce, Food Security and Cooperative Development, Wasantha Samarasinghe, Minister of Health and Mass Media Dr. Nalinda Jayatissa, North Central Province Governor Wasantha Jinadasa, Indian High Commissioner Santosh Jha and others.
[PMD]
Indian Prime Minister Shri Narendra Modi concludes State Visit to Sri Lanka
President Dissanayake and Indian PM Modi jointly commission upgraded Maho-Omanthai railway line & Maho-Anuradhapura railway signalling system
Prime Minister Modi and President Dissanayake pay homage to the sacred Jaya Sri Maha Bodhi
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