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BR says only Prez, PM and Cabinet can make him reverse move

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Only listed companies targeted to raise Rs 114 bn

By Shamindra Ferdinando

Finance Minister Basil Rajapaksa has declared that his proposals to impose 25 percent retrospective tax surcharge on listed persons or companies that earned over Rs 2 bn 2020/2021 and increase VAT (Value Added Tax) to 18 percent from the current 15 percent wouldn’t be abandoned.

Appearing on ‘Salakuna,’ a weekly political programme telecast Monday night live on ‘Hiru’ FM Rajapaksa emphasised that he wouldn’t succumb to pressure from those affected by his proposals. Responding to ‘Hiru’ anchor Chamuditha Samarawickrema, the FM said only President Gotabaya Rajapaksa and Preme Minister Mahinda Rajapaksa and the Cabinet could intervene.

FM Rajapaksa said that he discussed the issue at hand with the chambers and didn’t object to the imposition of the surcharge for a year or two in view of the devastation caused by the pandemic, though they opposed haphazard changes in taxes.

However, those companies that hadn’t been listed in the Colombo Stock Exchange were left out of the tax net in spite of them, too, being cash rich, much to the surprise of the business sector.

Rajapaksa urged the media not to engage in a campaign to pressure the government to do away with the proposals.

Presenting the Budget for 2022, Minister Rajapaksa proposed (a) one-time tax surcharge of 25 percent on persons or companies with taxable income over Rupees 2,000 million for the year of assessment 2020/2021. The government expected to recover Rs 100 bn through this tax and (b) VAT on banks and financial service providers to be increased to 18 percent from 15 percent. Minister Rajapaksa stressed that this tax should be paid monthly from 01 January 2022 to 31 December 2022 and not passed onto customers. The government expected to raise Rs 14 bn through the tax.

When some Opposition members interrupted Minister Rajapaksa immediately after he announced the 25 percent surcharge on a selected group of companies, the FM said that he would like to see who represented the interests of the targeted companies.

The Inland Revenue Department says the following companies are likely to be levied proposed one-off tax surcharge: LOLC Holdings (Rs.23,075 mn), Commercial Bank (Rs 16,940 mn ), Ceylon Tobacco (Rs. 15,578 mn ), ExpoLanka Holdings (Rs. 14,830 mn), HNB (Rs 14,096 mn), Dialog Axiata (Rs. 12.034 mn), Ceylinco Insurance (Rs.8,880 mn), Sampath Bank (Rs.8,442 mn), Vallibel One (Rs. 8,117 mn), Sri Lanka Telecom (Rs.7,880), Hayleys (Rs.7,637 mn), Distilleries Company of Sri Lanka (Rs. 6,962 mn), LB Finnace (Rs. 6,807 mn), Royal Ceramics Lanka (Rs. 6,135 mn), Central Finance Company (Rs. 5,544 mn), Tokyo Cement Company (Lanka) (Rs.5,425 mn), People’s Leasing and Finance (Rs. 5,295 mn), Dipped Products (Rs.5,140 mn), National Development Bank (Rs. 5,117 mn), John Keells Holdings (Rs.5,026), Carson Cumberbatch (Rs.4,804 mn), Richard Pieris and Company (Rs. 4,680 mn), Melstacorp (Rs. 4,425 mn), LOLC Finnace (Rs.4,365 mn), Nations Trust Bank (Rs. 4,055 mn), Hemas Holdings (Rs. 3,621 mn), Bukit Darah (Rs. 3,541 mn), Cargills (Ceylon) (Rs.3,481 mn), CIC Holdings (Rs.3,132 mn), Haycarb (Rs. 3,047), SeylanBank (Rs. 3,039 mn), Lanka Walltiles (Rs. 2,960 mn), Nestle Lanka ( Rs.2,947 mn), DFCC Bank (Rs. 2,745), Ceylon Guardian Investment Trust (Rs. 2,721 mn), Citizens Development Business Finance (Rs.2,554), Lanka Tiles (Rs. 2,475 mn), Lion Brewery Ceylon (Rs.2,471 mn), Singer Sri Lanka (Rs.2,452 mn), Ceylon Cold Stores (Rs.2,334 mn), CT Holdings (Rs.2,288 mn), Chevron Lubricants Lanka (Rs.2,225 mn), Commercial Leasing and Finance (Rs. 2,216 mn), Access Engineering (Rs. 2,173 mn), Teejay Lanka (Rs.2,139 mn), Pan Asia Banking Corporation (Rs.2,048) and Commercial Credit and Finance (Rs, 2,005).

Former banker and Samagi Jana Balavegaya lawmaker Eran Wickremaratne strongly opposes the budget proposal. Asked for his stand on FM Basil Rajapaksa’s move and whether the latest proposal is similar to the tax imposed by the UNP but not implemented, MP Wickremaratne told The Island: “The private sector is not averse to paying taxes. They want a predictable tax environment so that they can plan and execute business plans. A one-off tax is arbitrary and unpredictable. It destroys business confidence. It weakens planning as well as foreign investors’ confidence in the country.”

Referring to the doing away with one-off super gains tax declared in 2015 but never implemented, SJB lawmaker Dr. Harsha de Silva stressed that two wrongs did not make a right.

Sources said that the cash strapped government could have targeted unlisted companies too. However, the decision makers had conveniently restricted the targeted group from among the listed group.

Responding to ‘Salakuna’ queries, Minister Rajapaksha strongly defended sharp tax cuts imposed immediately after the change of government in 2019. The minister said that sharp reduction of taxes saved many private companies, including the one that employed the ‘Salakuna’ team of journalists. The minister said so when Chamuditha Samarawickrema asserted that the government caused unnecessary revenue issues by reducing a range of taxes amounting to well over Rs. 500 bn.



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Booster shots: Poor public response makes GMOA contemplate legal remedy

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By Rathindra Kuruwita

Lack of enthusiasm among the public to receive the booster dose was disconcerting, given that Sri Lanka had a long-established and highly functional immunisation programme, the Government Medical Officers Association (GMOA) said yesterday.

By 20 January 2022, 64.56% of Sri Lankans had been fully vaccinated, but only 22.47% had received the booster dose, the GMOA said.

“At the early stages of vaccination against Covid-19 the public response was favourable. However, the current waning of interest might be driven by the myths and rumours regarding the vaccines. It is important to take measures to counter such misinformation by raising public awareness of the ongoing vaccination programme.”

“Legal action against those responsible for the spread of communicable diseases can be taken under the Penal Code”, GMOA Secretary Dr. Senal Fernando said. “Provisions of the Quarantine Ordinance can be used against persons who do not comply with directions given by the proper authorities under the Quarantine Ordinance,” he said.

The GMOA said that several countries had made it mandatory to have proof of vaccination for entry into public places. The same thing could be done in Sri Lanka to ensure that more people got vaccinated.

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Govt., SJB haggle over procedure to rescue country

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By Saman Indrajith

The SJB on Sunday said that it was wrong for the President and the government to seek the assistance of the Opposition to steer the country out of the present crises without creating a proper forum to obtain such assistance.

Addressing the media at the Opposition Leader’s Office in Colombo, Chief Opposition Whip and Kandy District MP Lakshman Kiriella said President Gotabaya Rajapaksa delivering the latter’s third Policy Speech in Parliament last week had sought the assistance of the Opposition. “His speech is full of excuses. He sought our assistance but there is no forum to offer our assistance. The government too has asked for the same several times. If the government needs the Opposition’s assistance, what it should do is to declare a state of national disaster situation so that the Opposition could make use of Parliament as the forum for our contributions. That has not been done so far. The President and the government could make use of the provisions of the Disaster Management Act No 53 of 2005 to form a disaster management committee comprising the government and opposition MPs.

The President is the ex-officio Chairman of the committee, the Prime minister and the Opposition leader are there with 24 government ministers and five opposition MPs. In addition to that there are provisions to the involvement of the Chief Ministers of Provinces in the committee. If the government genuinely needs our support it should have started forming that committee. There are laws enabling the formulation of mechanisms to help people the government does not make use of them. We have been repeatedly asking the government to appoint that committee.

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Lord Ahamad plants kumbuk tree sapling during visit to Bellanwila – Attidiya Bird Sanctuary

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By Ifham Nizam

Lord Tariq Ahmad of Wimbledon, Minister for South Asia, the United Nations and the Commonwealth at the Foreign, Commonwealth and Development Office of the UK, planted a Kumbuk (Terminalia arjuna) sapling at the Bellanwila – Attidiya Bird Sanctuary last week.

The Department of Wildlife said Lord Ahmad had been joined by the British High Commissioner in Colombo Sarah Hulton, Hasanthi Urugodwatte Dissanayake, Acting Additional Secretary of Ocean Affairs, Environment and Climate Change at the Foreign Ministry, Saman Liyanagama, Wildlife Ranger of the Colombo Wildlife Range, Department of Wildlife Conservation and Professor Sevvandi Jayakoddy, Senior Lecturer of the Wayamba University.

The planting activity was followed by a brief visit to the wetland and Prof. Jayakoddy, and Liyanagama explained the importance of wetland ecosystems as well as challenges in conservation and maintenance, while Dissanayake briefed him on the Sri Lanka’s pioneering work related to mangrove restoration and conservation, both at policy level as well as at the ground level.

Hasini Sarathchandra, Publicity Officer, Department of Wildlife Conservation said British High Commission in Colombo with the International Water Management Institute Headquartered in Sri Lanka, had already launched a project under the Darwin Initiative at the Baddegana Wetlands.  Similar collaborations are envisaged involving the Bellanwila – Attidiya Bird Sanctuary.

Wetlands play an important role in our natural environment. They mitigate the impacts of floods, absorb pollutants and improve water quality. They provide habitat for animals and plants and many contain a wide diversity of life, supporting plants and animals that are found nowhere else. Colombo is a city built on and around wetlands. Despite progressive loss and degradation, wetlands still cover some 200 km2 of the Colombo metropolitan area and suburbs.

The wetlands are fundamental to the well-being of the people of Colombo and its suburbs. The wetlands can reduce extreme air temperatures and make the city more live able due to evaporative cooling. The wetlands provide a critical land-mass which helps to maintain the richness of Colombo’s biodiversity.

The Bellanwila-Attidiya wetlands was declared as a bird sanctuary on 25 July 1990, due to biodiversity of the area and its contribution to controlling floods. The wetlands, which span over 930 acres, host endemic species and is a paradise for migratory birds. 44 species of fish including 06 which are endemic to the country have been identified in the Bolgoda River which flows through the wetlands. The wetlands are also home to 21 reptilian species, 17 species of mammals and 10 butterfly species. Bellanwia-Attidiya sanctuary falls within the upper catchment of the Bolgoda river basin. The Department of Wildlife Conservation manages the Bellanwila-Attidiya Sanctuary.

Selection of the location was also due to the close collaboration that Sri Lanka has with the Government of the UK on conservation of mangroves and wetlands.

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