News

Anti-tax strikes threaten to bring Lanka’s ailing economy to standstill

Published

2 years ago

2023/03/5

ECONOMYNEXT –Trade unions representing medical, banking and other sectors in Sri Lanka are on strike at significant cost to the cash-strapped island nation’s ailing economy, demanding that an IMF-backed tax hike be revoked.

Broadcast media reported that patients visiting OPD clinics at a number of state hospitals in Anuradhapura, Polonnaruwa and elsewhere were inconvenienced as doctors, who are among the highest-earning professionals in the country, refused to report to work on Wednesday March 01 as part of trade union action against a controversial progressive tax regime.

The trade union action included strikes, token strikes, sick leave and other measures. Some 40 trade unions representing the state sector and some private entities were engaged in the campaign around the island against the 6 to 36 percent personal income taxation on people earning over 100,000 rupees a month.

Wednesday’s strike is the latest in a series of campaigns launched by trade unions demanding that the government withdraw the new tax policy, which the government says is vital at least for the time being while Sri Lanka recovers from its worst currency crisis in decades.

Sources close to the government recently claimed that the International Monetary Fund (IMF), whose broad approval for a much needed 2.9 billion US dollar loan has yet to be given, had recommended that Sri Lanka’s income tax threshold be lowered to 45,000 rupees but the government negotiated to keep it at 100,000.

The tax hike has been met with stiff resistance from various professional associations and trade unions, with low-intensity demonstrations held in Colombo and elsewhere since January, demanding its withdrawal. These professionals include doctors, university lecturers, banking sector employees and others who earn significantly more than a vast majority of the public. Some doctors collect substantial earnings through private practice.

Wednesday’s strike and protests was the biggest anti-tax agitation held yet. Banks, both state and some private, were closed in Galle, Hatton and other cities, according to reports.

“Stop the brain drain,” was a prominent slogan at one of the anti-tax protests held on Wednesday, “brain drain” being one of the key arguments used against the tax hike.

The Government Medical Officers Association (GMOA) has been at the forefront of the trade union action. GMOA secretary Dr Haritha Aluthge told reporters on Wednesday that there is a danger of more and bigger campaigns being launched in the future without warning.

“We ask the government to listen to the concerns raised by professionals and the people,” he said.

Sri Lanka’s new tax regime has both its defenders and detractors, both equally vociferous. Critics who are opposed to progressive taxation said it serves as a disincentive to industry and capital which can be invested in business. They argue that a flat rate of taxation is implemented where everyone is taxed at the same rate.

Others, however, contend that the new taxes only affect some 10-12 percent of the population and, given the country’s economic situation, is necessary, if not vital.

Critics of the protesting workers argue that most of the workers earn high salaries that most ordinary people can only dream of, and though there may be some cases where breadwinners could be taxed more equitably, overall, Sri Lanka’s tax rates remain low and are not unfair.

All News Advertisement

Latest News

Our government has reaffirmed its commitment to breaking barriers that limit women’s full participation in the economy, recognizing their vital role in national development. – Dr. Harini Amarasuriya

Published

2 hours ago

2025/03/15

Priyan

“Women play a pivotal role in Sri Lanka’s economic and social development. Yet, despite their immense contribution, structural barriers continue to limit their full participation in the economy. Our government is committed to breaking these barriers by fostering an inclusive economic environment where women can thrive as business leaders, entrepreneurs, and exporters.” Said Prime Minister Dr. Harini Amarasuriya

The Prime Minister made this statement while addressing the launching the She Trades Sri Lanka Hub funded by the UK’s She Trades Commonwealth+ Program held at Galle face Hotel in Colombo on March 14 organized by the Sri Lanka Export Development Board (EDB) and the International Trade Centre (ITC).

While addressing the audience, the Prime minister stated, the government has reaffirmed its commitment to breaking barriers that limit women’s full participation in the economy, recognizing their vital role in national development. Emphasizing gender-inclusive policies, financial inclusion, and access to global markets, authorities are prioritizing support for women-led businesses in key sectors such as ICT, agribusiness, and engineering.

A new initiative will establish 200 women-led cooperatives, fostering supportive environments for female entrepreneurs. Additionally, efforts to strengthen childcare, elderly care, and disability services aim to reduce the burdens that limit women’s economic participation.

A dedicated platform has been launched to provide women entrepreneurs with knowledge, networking, and international trade opportunities. Strengthening public-private partnerships and expanding global market access are key strategies to create an inclusive and sustainable trade ecosystem.

By equipping women with the necessary skills, financial resources, and digital trade access, the government aims to ensure that women entrepreneurs become key drivers of economic growth, aligning with broader policies for inclusive and sustainable development.

The event was attended by Ms. Pamela Coke-Hamilton, Executive Director of the International Trade Center, His Excellency Andrew Patrick, British High Commissioner to Sri Lanka, Officials from the International Trade Center and the British High Commission in Sri Lanka, Chairman of the Export Development Board Mr. Mangala Wijesinghe and Officials from Export Development Board and International Trade Centre and woman Entrepreneurs.

(Prime Minister’s Media Division)

News

Batalanda Commission report tabled … finally

Published

8 hours ago

2025/03/15

Thilina Walpola

by Saman Indrajith

TheBatalanda Presidential Co-mission report was tabled in Parliament yesterday (14) by the Leader of the House and Transport Minister, Bimal Ratnayake.

Minister Ratnayake announced that the government has decided to forward the report to the Attorney General for legal advice. Additionally, a Presidential Committee will be appointed to provide guidance and recommendations on how to proceed with the findings of the report.

Ratnayake said that the Cabinet-of-Ministers, along with President Anura Kumara Dissanayake, has made a policy decision to take necessary action in response to the report. He reassured the public that steps are being taken to ensure that such a dark chapter in the country’s history is never repeated.

Minister Ratnayake said that a two-day debate on the Batalanda Commission report will be scheduled in Parliament at an appropriate time, allowing for a detailed discussion on the report’s findings and recommendations.

The report, which will be printed in all three official languages—Sinhala, Tamil, and English—will be made available to the public in the near future. Ratnayake confirmed that printed copies would be provided to Members of Parliament, as well as the general public, for review.

The Leader of the House revealed that there are 28 evidence volumes associated with the Commission’s work, which will be submitted to Parliament at a later date for further scrutiny.

Ratnayake said that as the entire country is concerned about the findings of the Batalanda Commission, the government’s commitment to addressing the issues raised, and preventing future atrocities, stands clear. The next steps, including legal action and policy recommendations, will be shaped by expert advice and informed parliamentary discussions, he said.

News

COPE finds fake documents submitted for emergency procurement of drugs

Published

8 hours ago

2025/03/15

Thilina Walpola

The Parliamentary watchdog Committee on Public Enterprises (COPE) has found that there were fake documents regarding the importing of medicines under the emergency procurement system in 2022 and 2023.

This was revealed during a COPE meeting held at Parliament probing the transactions of the National Medicine Regulatory Authority (NMRA).

NMRA CEO Saveen Semage told the Committee that several fake documents have been found due to the lack of registration of medicines.

Stating that six such fake documents were found last year alone, Saveen Semage said he had recorded statements regarding each of the documents with the Financial Crimes Investigation Division.

He revealed that, however, no investigations have been conducted yet into the incidents.

“We have documents with confessions from a woman accepting that fake documents had been made. However, a statement has not even been recorded from that woman yet,” he said.

Meanwhile, COPE member MP Asitha Niroshana Egoda Vithana also revealed that the highest number of waive-off registrations (WOR) for medicines had been obtained in 2022 and 2023.

He said 656 waive-off registrations (WOR) had been obtained in 2022 and 261 in 2023, adding that this proves that discrepancies have taken place during the emergency procurement of medicines during these periods.

Furthermore, Deputy Director General of the Medical Supplies Division of the Health Ministry, Dr. G. Wijesuriya, said discussions are underway on allowing the State Pharmaceutical Corporation (SPC) to directly import essential medicines.He pointed out that it was essential to take a policy decision in this regard as a solution to mitigate such discrepancies.