News
COPF: Tax concessions granted to BoI enterprise should be scrutinised
‘There cannot be special status for anyone when across the board 30% tax is imposed on exporters’
By Shamindra Ferdinando
Committee on Public Finance (COPF) Chairman and SJB MP Dr. Harsha de Silva says unprecedented tax concessions given to HCL Technologies (HCL) that entered into an agreement with John Keels Holdings (JKH) last year should be reviewed in view of the imposition of a controversial 30 percent tax across the board on companies in the exports sector with effect from 01 Nov.Dr de Silva emphasised that reappraisal was necessary as the proposed tax would be imposed in line with the recent staff-level agreement reached with the International Monetary Fund (IMF).

Noting that the agreement hadn’t been tabled in Parliament yet, the Colombo District MP said that India-Sri Lanka joint enterprise couldn’t be granted special status in terms of the Strategic Development Project Act, No. 14 of 2008 at a time the country was in dire straits.
Dr. de Silva said on Saturday (15) that particular Act should be rescinded in view of the agreement with the IMF. The economist questioned the unchecked authority enjoyed by the Minister, assigned that particular subject, to grant concessions up to a period of 25 years.Responding to another query, Dr. de Silva said that the economy was in such bad shape the whole process of granting concessions to investors should be reevaluated.
Failure to do so could trigger public protests at an unprecedented scale. SJB leader Sajith Premadasa has repeatedly flayed the Wickremesinghe-Rajapaksa government over declaration of a range of taxes. The COPF on Oct 04 granted approval for sweeping tax concessions to the HCL-JKH enterprise, less than 24 hours after rejecting the proposal made by Chairman of the Board of Investment (BoI) Raja Edirisuriya for exemptions of VAT, Dividend tax, PAL, CESS, Income tax, customs duty, etc.
At the time of the new appointment, Edirisuriya served as the Executive Director of the Colombo Port City Development Project. One-time Chairman of bankrupt Mihin Lanka succeeded Sanjaya Mohottala, who resigned after having appointed 29 staff with salaries over Rs 700,000 a month.
Under the agreement between HCL and JKH, the former occupied 80 percent of space in the 30-storey Grade –A state-of-the–art Cinnamon Life complex. The finalization of that agreement and the inauguration of the project was attended by the then BoI Chairman Sanjaya Mohottala, JKH Chairman Krishan Balendra, Indian High Commissioner Gopal Baglay, the then Finance Minister Basil Rajapaksa, HCL Technologies Chief Financial Officer Prateek Aggarwal, and Corporate Vice President Srimathi Shivashankar.
The Island sought an explanation from Dr. de Silva why the COPF granted approval having lambasted the top management of the BoI for seeking a far-reaching tax holiday at a time the bankrupt government was taxing all, regardless of the consequences. Dr. de Silva said the parliamentary watchdog committee didn’t enjoy executive powers.
Referring to a statement issued that had been issued by Parliament on Oct 04 in this regard, Dr. de Silva said though the parliamentary watchdog committee granted approval for the relevant after receiving required information, the basis for giving such tax concessions should be properly analyzed and a appropriate policy prepared in future to determine the tax concessions depending on the size of the investment.
Minister Vidura Wickramanayaka, State Ministers Shehan Semasinghe, (Dr.) Suren Raghavan, Members of Parliament Anura Priyadharshana Yapa (Dr Harsha de Silva’s predecessor), Chandima Weerakkody, Mayantha Dissanayake, Harshana Rajakaruna and Prof Ranjith Bandara (Chairman, Committee on Public Enterprises) attended the Oct. 04 COPF meeting.HCL entered Sri Lanka in 2020 as the country was rapidly heading towards economic crisis.
The COPF earned praise from the public for the stand taken at the Oct 03 meeting where the outfit strongly opposed India-based Tech Company a slew of tax concessions spanning more than 10 years, including an exemption from the income tax for 17 years, with the final five at half the rate. Both de Silva and COPF member Dr. Suren Raghavan declared the BoI proposal was unacceptable. At one point SLFPer Raghavan said that he didn’t want his house to be attacked again. Referring to the destruction of his house during the July 1983 riots, Dr. Raghavan said that the same fate would befall him if the COPF granted such concessions. However, MP de Silva advised Dr. Raghavan not to be so dramatic.
The COPF took a strong stand after the top management of the BoI failed to answer Dr. de Silva’s query regarding the basis for such large tax concessions. The MP asked: “You are asking the COPF to grant a 12-year total tax holiday. If this was approved, what is the tax benefit that would be given to the company and the foregone tax to the Government?”
An irate de Silva said “This is embarrassing, Chairman. This is not how to run a BoI. We have given you ample time to come up with the figures. You are embarrassing the Government, coming here asking for a massive tax break for 17 years. Can you run a county like this Chairman? Even a tea boutique is run better. You should feel very very bad and be ashamed. Your conduct is not professional, this is not how to conduct official business. In my entire career, I have not faced such a hopeless situation like this.” Dr. de Silva questioned Edirisuriya over his role in the Colombo Port City development. The COPF asserted that the BoI was struggling to cope up with its duties, and responsibilities, and run in an extremely unprofessional manner.
News
Presidential Suite at Sri Jayewardenepura General Hospital opened to the public
The special ward at Sri Jayewardenepura General Hospital, which had until now been reserved exclusively for the use of the Executive President, was opened for the public for the provision of medical treatment to the general public from Tuesday (24).
This decision was taken jointly by the Ministry of Health and the hospital administration, in accordance with instructions given by President Anura Kumara Dissanayake.
Constructed in 1984 with a grant from the Government of Japan, Sri Jayewardenepura General Hospital was originally established with a capacity of 1,000 beds. However, in line with the initial design, an additional special unit, designated as Room No. 1001, was included exclusively for the personal use of the Executive President.
Over the 42 years since the hospital’s establishment, this facility has been utilised only on a very limited number of occasions. Nevertheless, it has been maintained over the years in anticipation of a possible visit by a sitting President, without being made available for patient use.
With effect from today, this special unit will be utilised for the benefit of general patients receiving treatment at the hospital. This step has been taken in line with the Government’s policy of ensuring the more efficient use of public assets and resources to meet the healthcare needs of the people.
News
Cabinet Sub-Committee appointed to streamline the Public Service meets for the second time
The second meeting of the Cabinet Sub-Committee appointed to ensure the orderly functioning of the public service was held on Tuesday (24) afternoon at the Presidential Secretariat, under the patronage of Prime Minister Dr Harini Amarasuriya.
Extensive discussions were held on the immediate measures required to ensure the uninterrupted delivery of government services to the public and to address the challenges faced by public servants.
Attention was also drawn to maintaining the continuous operation of services under the Ministries of Public Administration, Provincial Councils and Local Government, Health, Education, and Justice. Accordingly, it was decided to ensure that examinations are conducted as scheduled and that essential medicines are supplied to hospitals without disruption.
The challenges in passenger transport services and the railway transport system, as well as future measures, were also discussed at length. Focus was also placed on the steps to be taken regarding the transportation of essential goods.
In addition, attention was given to introducing digital service systems to facilitate working from home and to enhance the efficiency of existing services. It was also noted that these activities would be supervised under the Ministry of Digital Economy.
Instructions were further issued to review the current energy management practices across all ministries and departments and to take steps to implement necessary policy changes.
Minister of Public Administration, Provincial Councils and Local Government A. H. M. M. H. Abeyaratne, Secretary to the Prime Minister Pradeep Saputhanthri, Chief of Staff to the President Prabath Chandrakeerthi, Secretary to the Ministry of Public Administration, Provincial Councils and Local Government S. Aloka Bandara, Secretary to the Ministry of Health and Mass Media Dr Anil Jasinghe, Secretary to the Ministry of Energy Professor T. M. Udayanga Hemapala, Secretary to the Ministry of Digital Economy T. R. W. S. Dhanapala, Secretary to the Ministry of Justice and National Integration Ayesha Jinasena, PC, Senior Additional Secretary to the President Roshan Gamage, and Chairman of the Ceylon Petroleum Corporation D. J. A. S. S. Rajakaruna, along with other committee members, were also present at the occasion.
News
Energy Minister indicted on corruption charges ahead of no-faith motion against him
… first NPPer to face charges under Section 70 of Bribery Act
Colombo High Court has issued summons on Energy Minister Kumara Jayakody to appear in court today (27) to serve indictment in a corruption case filed by the Commission to Investigate Allegations of Bribery or Corruption (CIABOC). Action has been taken under Section 70 of the Bribery Act. The losses suffered by the government have been estimated at Rs. 8,859,708.
National List (NL) MP Jayakody is the first NPP minister or politician at any level to be indicted for corruption. The NPP parliamentary group consists of 159 including 18 NL members.
The summons has been issued by High Court judge Rashantha Godawalage.
Although CIABOC previously in many instances arrested those who had been under investigation and produced them before Magistrate courts, Minister Jayakody has been directly summoned by the Colombo High Court.
The investigation into alleged corruption in procurement during the time Jayakody served the Ceylon Fertilizer Corporation (CFC) started after the change of government in 2015.
According to the CIABOC investigation, the alleged instance of corruption took place in early 2014 towards the tail end of Mahinda Rajapaksa’s second term. At that time Jayakody was CFC’s Procurement Manager, and the CIABOC dragged the investigation until its current leadership under overall speeding up of the cases recently completed the inquiry.
Parliament recently announced that the debate on no-faith motion moved against Minister Jayakody over alleged irregularities in the procurement of substandard coal for the country’s only coal-fired power station at Norochcholai.
SJB MP Mujibur Rahman said that the NPP, having campaigned on an anti-corruption platform during presidential and parliamentary polls in 2025 couldn’t under any circumstances shield minister Jayakody. The indictment of Jayakody over a corruption case that had happened in 2014 and the failure on his part to fulfill obligations as Energy Minister under the current dispensation couldn’t be considered separately, the Colombo District MP said.
The issue at hand is whether the NPP would try to protect Jayakody at the expense of the government, MP Rahman said. Once the NPPer is formally charged in a corruption case the government would find it extremely difficult to keep him in the cabinet, the former UNPer said.
SJB lawmaker S.M. Marrikar recently warned Minister Jayakody that he should be prepared to serve a jail term. The warning was issued at a media briefing that primarily dealt with the alleged irregularities in the procurement of coal and their decision to move a no-faith motion against the minister. Marrikar explained how the crisis coupled with the growing diesel shortage could compel the government to increase electricity tariffs by as much as 18 percent next week. MP Marikkar said that they were eagerly waiting to see who backs Jayakody at the expense of the government during the upcoming vote on the no-faith motion.
There had been a previous case of a sitting minister being charged under the Bribery Act in respect of corruption perpetrated as a government servant. MP Rahman said that they intended to intensify the ongoing campaign against the government on the strength of the unprecedented corruption case and the outcome of the no-faith motion. “Of course, they have the numbers to defeat our no-faith motion. But, in doing so, they end up with egg on their face. That is the reality,” Rahman said, adding that those responsible for waste, corruption and irregularities whichever political parties they represented shouldn’t expect special status.
MP Rahman alleged that the CIABOC granted special status to Minister Jayakody. All those who had been indicted previously were first called to the CIABOC, recorded their statements and then arrested, handcuffed and produced in court. The media was afforded the opportunity to cover their humiliation, MP Rahman said, but in this case the powers that be paved the way for the accused to receive indictments directly from the Colombo High Court.
“Let us see whether the Bar Association of Sri Lanka responds to this development,” MP Rahman said.
By Shamindra Ferdinando
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