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Ceylon Chamber puts the National Budget 2022 in a broader perspective

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Welcomes the focus on digitisation and infrastructure development

Concerned about the proposal to increase retirement age to 65 years

Says the one-off surcharge tax would dampen investor confidence

Urges clarifications on some of the new tax measures

Says multiple taxes could place a heavy burden on the banking sector

Budget 2022 has signalled policy continuity in terms of maintaining mainstream corporate tax rates and investment incentives continuing from end 2019, the Ceylon Chamber of Commerce said in a press statement yesterday.

The Chamber welcomes the focus on digitization, development of the hub concept, infrastructure development in investment promotion zones/SME development zones, removal of registration fees for start-ups, green economy and targeted relief for vulnerable sections of the public impacted by the pandemic. While welcoming the several steps announced to improve the financial management of public sector institutions, the Chamber is concerned that these may be negated by the proposals to increase the retirement age to 65 years and the cadre by 50,000 new recruits.

The Chamber further said: “The recognition of the need to reform state owned enterprises and optimise the use of underutilized state assets is noteworthy and we look forward to more opportunities being created in the near future for private sector participation in this process.”

“In the Pre-Budget proposals, we highlighted the importance of the Government maintaining the current tax laws and rates while maintaining macro stability and focusing on developing key areas of the economy. We are pleased to note the alignment of policies with our budget submissions and past recommendations related to Tax administration, Trade Facilitation (in particular, implementation of the National Single Window), improving the Ease of doing business by specific export facilitation, improving backward linkages in the apparel sector, re-skilling of workforce, acceleration of e-government and improving of land usage.”

“The private sector understands the need to identify new revenue measures to bridge the budget deficit given the impact of the pandemic on the economy. However, the imposition of the one-off surcharge tax would dampen investor confidence given the retrospective implications of such taxes. The proposed Social Security Contribution will also have an adverse impact on low margin businesses, including those subject to price controls and financial intermediaries while also having a cascading impact. As such, we recommend to consider sourcing this revenue through established measures such as VAT or the previously abolished Nation Building Tax. The proposed multiple taxes could place a heavy burden on the Banking sector, which is supporting the post-pandemic recovery of most sectors, potentially weakening the financial system in the country.”

“There are clarifications needed on some of the new tax measures such as the implementation of the Social Security Contribution, Surcharge Tax and penalty on vehicles meeting with accidents. While there are laudable proposals such as expenditure allocations for irrigation, development of organic fertiliser, simplification of trade taxes to name a few, these lack adequate details at this stage to assess the desired impact. Therefore, the CCC would recommend that policymakers consult with relevant stakeholders who would be willing to contribute to the development of specific strategies to achieve the desired outcomes.”

“While the budget recognised the need for fiscal consolidation and the rebuilding of Sri Lanka’s foreign exchange reserves, it fell short on addressing the key macroeconomic challenges of managing the shortage of foreign exchange in the market and refinancing of debt in the short to medium term. The budget would have been an ideal opportunity to reassure investors, provide clarity and build confidence while further complimenting some of the measures outlined in the Central Bank’s Six-month Roadmap. Similarly, the Government could have used the opportunity to signal its commitment to phase out the currently prevailing import restrictions that are not sustainable in the long term.”

“Recent actions by the Government to move away from price controls on several essential products is greatly appreciated by the Chamber as it has helped to overcome shortages and improve availability. The Budget could have also signaled the policy shift towards establishing a market driven pricing formula for commodities like fuel and gas as well as other essential commodities which were previously under price control. This would assist the Government in raising revenue while managing the foreign exchange situation.”

“The Ceylon Chamber in its capacity as the premier representative of the private sector, looks forward to an ongoing engagement with the Government, and for the opportunity to play a meaningful role alongside the private sector at large, with respect to the implementation of the budget proposals.” it said.



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ComBank partners with PayHere to offer Q+ users a unique eCommerce experience

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Commercial Bank’s Group Chief Marketing Officer Mr Hasrath Munasinghe (2nd from right) and PayHere Founder/CEO, Mr Dhanika Perera (2nd from left) exchange the agreement in the presence of PayHere Head of Developments, Mr Karvin Mendis (extreme left) and the Bank’s Senior Manager – Card Centre Mr Seevali Wickramasinghe.

The Commercial Bank of Ceylon has partnered with PayHere, Sri Lanka’s largest Aggregated Internet Payment Gateway Service, to offer users of its Q+ Payment App a unique, user-friendly and secure eCommerce experience.

Commercial Bank customers can now conveniently pay for their purchases via the Q+ app to over 3300 registered PayHere Online Payment Service enabled merchants. The Bank’s Credit, Debit and Prepaid Card holders who pay through Q+, the fastest-growing QR app in the country, will not be required to tap in their card details as this information is already stored on the app, the Bank said.

Payments to PayHere merchants via the Q+ Online Pay facility will enhance customer convenience as the transaction will only require the entering of users’ mobile numbers registered with the app. Disbursements via Q+ require authentication using a static PIN which ensures the safety and security of transactions, making the Q+ App more secure than a normal card as the customers’ sensitive data is not transmitted to merchant websites.

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TAMAP drives Stakeholder Forum for Good Agriculture Practice

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Secretary of Agriculture Prof. Udith K Jayasinghe addressing the forum

The inaugural meeting of the GAP Stakeholder Forum was held with the support of the Technical Assistance to the Modernisation of Agriculture Programme (TAMAP) at the Department of Agriculture in Peradeniya on 17 November 2021. Prof. Udith K Jayasinghe, Secretary Ministry of Agriculture, graced the occasion as the Chief Guest.

The Good Agricultural Practices (GAP) programme, introduced by the Department of Agriculture in 2016, was a promising step taken to minimise adverse impacts of agriculture on the ecosystem and human health while meeting steadily rising demand for food. Although the programme had an encouraging start, the overall conversion of farmers to implementing GAP remained low. Over the past six years, 1500 farmers registered as GAP producers out of the 1.8 million farmers in Sri Lanka. To align with the current policy of the Sri Lankan Government to improve ecological friendliness of farming, it is important to transform all production units towards GAP farms.

Studies showed that to achieve this goal, the GAP implementation strategies needed to be updated and infused into the mainstream agriculture, facilitating a quick transformation of the current approach towards a macro-level system. Therefore, the requirement for a rapid strategizing of such an approach followed by periodic review of GAP performance arose. This initiated the need for a stakeholder forum.

The key purpose of the forum is to provide a common platform for key stakeholders to meet in formulating a strategy to mainstream SL GAP, propose a way forward for implementation such recommendations, and to regularly review program performance and adopt remedial action to achieve GAP objectives.

Prof. Udith K Jayasinghe, Secretary Ministry of Agriculture who chaired the Forum in his opening statement commented, “GAP programme has emerged a solution to challenges faced by Sri Lankan agriculture today to improve safety of users and ensuring good environmental performance. Reinforced by facilitating legislation and approved national standards, GAP programme provides a strong foundation towards addressing above concerns.”.

Over forty participants were present at the forum, representing the various stakeholder groups comprising producers, distributers, SL GAP team, academics, and market players. Ms D. S. Ratnasinghe, Addl. Director (Agribusiness) and Dr W. M. W. Weerakoon, National Coordinator outlined the status of the GAP programme and the challenges faced.

The deliberations during the forum were broken down into five main areas: Technical, financial, institutional, and social problems faced by GAP stakeholders on maintaining production, supply, product quality, and consumer trust. Gaps in technology transfer and adoption, marketing and quality control measures and means for increased rate of adoption and GAP farm certification; Gaps in current GAP process and procedures, user friendliness and applicability; Future technological needs towards increasing production, productivity, product quality and ecosystem sustainability; and Policy needs for increased adoption of GAP to mainstream GAP into national agriculture agenda.

Prof. G. Pushpakumara, Faculty of Agriculture, University of Peradeniya and Ms Jayantha Ilankoon, ADG (Dev) moderated the forum through group activity, outcome presentations and strategic discussions on the way forward.

Concluding the forum, Dr Nihal Atapattu, stated, “TAMAP, along with the European Union that provided the funding support is very pleased to have assisted to launch several interventions that would promote recognition of GAP as a premier means of strengthening Sri Lankan agriculture in sustainably meet requirements of the domestic and export markets. TAMAP expects that the Stakeholder Forum launched today will be a milestone event in advancing GAP to achieve its potential in Sri Lanka”.

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HNB’s commitment to expand e-commerce and digital payments wins Daraz award

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Daraz Managing Director Rakhil Fernando (fourth from left) handing over the award to HNB Head of Cards – Gauthami Niranjan. Also present (from left): Daraz Partnerships Nimesh Dasanayake, Daraz Senior Manager – Prepayments Sandamina Rajapaksha, Daraz Head of Partnerships Dulika Jayamanne, HNB Cards Business Development Executive - Ashokan Harishanna, HNB Assistant Manager - Cards Business Development and Portfolio Management - Imanka Keshini Hikkaduwage and HNB Cards Business Development Executive – Roshan Chaminda Perera.

HNB has been recognized by Daraz for exceptional contribution to its growth, in an independent endorsement of Sri Lanka’s leading private bank’s commitment to expand e-commerce and digital payments throughout the country.

The award, for the ‘Card Base with Highest Overall Growth’, was presented to HNB at the ‘Daraz Payment Partner Performance Awards 2021’. HNB, which ranks among Daraz’s best banking partners, recorded the highest growth on total payment volume, buyer engagement and total transactions month-on-month, for both credit and debit cards for the year 2020-2021.

“This award is an important validation how the local economy – both businesses and consumers – are benefiting from HNB’s cohesive programme to drive greater adoption of e-commerce and digital payments,” HNB Head of Cards, Gauthami Niranjan said. “These efforts are particularly significant at present, given how digital and contactless payments can assist in reducing the spread of the pandemic and support the Bank’s and the country’s vision to transform Sri Lanka to a cashless economy.”

Currently, HNB Cardholders enjoy multiple offers on Daraz, Sri Lanka’s leading online marketplace, a wholly-owned subsidiary of global e-commerce giant, the Alibaba Group. These include zero-interest instalment plans up to 48 months with attractive discounts for HNB Credit and Debit Cards and 10% off site-wide on Daraz for all HNB Credit Cards on purchases made during Saturdays. In addition, HNB tied up with Daraz for its 11:11 and Black Friday sales, which provided HNB Cardholders access to a range of offers and massive discounts.

HNB has been a pioneer in Sri Lanka’s banking industry in the digital banking and digital payments space. These include the launch of digital wallet and payment app, HNB SOLO and introducing Asia’s first-ever fitness-linked savings product in the form of the HNB FIT Savings Account.

With 254 customer centres across the country, HNB is one of Sri Lanka’s largest, most technologically-innovative banks, having won local and global recognition for its efforts to drive forward a new paradigm in digital banking. HNB has a national rating of AA- (lka) by Fitch Ratings (Lanka) Ltd. The bank was also ranked among the World Top 1,000 Banks list compiled by the prestigious UK-based Banker Magazine for five consecutive years. HNB was also declared Best Sub-Custodian Bank in Sri Lanka at the Global Finance Awards 2020.

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